Curtiss Construction Company, Inc., entered into a fixed-price contract with Axelrod Associates on July 1, 2016, to construct a
four-story office building. At that time, Curtiss estimated that it would take between two and three years to complete the project. The total contract price for construction of the building is $4,000,000. Curtiss concludes that the contract does not qualify for revenue recognition over time. The building was completed on December 31, 2018. Estimated percentage of completion, accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to Axelrod under the contract were as follows:
At 12-31-2016 At 12-31-2017 At 12-31-2018
Percentage of completion 10% 60% 100%
Costs incurred to date $350,000 $2,500,000 $4,250,000
Estimated costs to complete 3,150,000 1,700,000 0
Billings to Axelrod, to date 720,000 2,170,000 3,600,000
Required:
1. Compute gross profit or loss to be recognized as a result of this contract for each of the three years.
Year Gross Profit (Loss) Recognized
2016
2017
2018
Total project profit (loss)
2. Assuming Curtiss recognizes revenue over time according to percentage of completion, compute gross profit or loss to be recognized in each of the three years.
Year Gross Profit (Loss) Recognized
2016
2017
2018
3. Assuming Curtiss recognizes revenue over time according to percentage of completion, compute the amount to be shown in the balance sheet at the end of 2016 and 2017 as either cost in excess of billings or billings in excess of costs.
Balance Sheet (Partial) 2016 2017
Current assets:
Current liabilities:
At 12-31-2016 At 12-31-2017 At 12-31-2018
Percentage of completion 10% 60% 100%
Costs incurred to date $350,000 $2,500,000 $4,250,000
Estimated costs to complete 3,150,000 1,700,000 0
Billings to Axelrod, to date 720,000 2,170,000 3,600,000
Required:
1. Compute gross profit or loss to be recognized as a result of this contract for each of the three years.
Year Gross Profit (Loss) Recognized
2016
2017
2018
Total project profit (loss)
2. Assuming Curtiss recognizes revenue over time according to percentage of completion, compute gross profit or loss to be recognized in each of the three years.
Year Gross Profit (Loss) Recognized
2016
2017
2018
3. Assuming Curtiss recognizes revenue over time according to percentage of completion, compute the amount to be shown in the balance sheet at the end of 2016 and 2017 as either cost in excess of billings or billings in excess of costs.
Balance Sheet (Partial) 2016 2017
Current assets:
Current liabilities:
1 answer:
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Answer:
there will be a surplus of retail workers in this labor market.
Explanation:
In the attached diagram the scenario is illustrated.
When the minimum wage is above the equilibrium wage it means that the minimum wage is above what employees are willing to pay workers. So employees will be less wiling to pay this amount.
There will be a reduction in the number of available slots for workers.
On the other hand workers will receive higher wage than they expected but since the slots for work are now limited there will be a surplus of labour in the market
