A construction company entered into a fixed-price contract to build an office building for $18 million. Construction costs incurred during the first year were $6 million, and estimated costs to complete at the end of the year were $9 million. The company recognizes revenue over time according to percentage of completion. During the first year the company billed its customer $6 million, of which $3 million was collected before year-end. What would appear in the year-end balance sheet related to this contract? Note: Enter your answers in whole dollars and not in millions (i.e., $4 million should be entered as $4,000,000).

A construction company entered into a fixed-price contract to build an office building for $18 million. Construction costs incurred during the first year were $6 million, and estimated costs to complete at the end of the year were $9 million. The company recognizes revenue over time according to percentage of completion. During the first year the company billed its customer $6 million, of which $3 million was collected before year-end. What would appear in the year-end balance sheet related to this contract? Note: Enter your answers in whole dollars and not in millions (i.e., $4 million should be entered as $4,000,000).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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