ABC Co. started work on an P8,000,000 fixed-priceconstruction contract in 20x1. Information on the contract isas follows:20x220x12,850,000 3,670,000Costs incurred per yearEstimated costs to complete 4,275,000 1,630,000How much profit (loss) is recognized in 20x2?

Estimated profits show the difference between the contract price and the estimated cost that is to…

ABC Co. started work on an P8,000,000 fixed-pric construction contract in 20x1. Information on the contract as follows: 20x1 20x2 Costs incurred per year 2,850,000 3,670,000 Estimated costs to complete 4,275,000 1,630,000 How much profit (loss) is recognized in 20x2?

ABC Co. started work on an P8,000,000 fixed-pric construction contract in 20x1. Information on the contract as follows: 20x1 20x2 Costs incurred per year 2,850,000 3,670,000 Estimated costs to complete 4,275,000 1,630,000 How much profit (loss) is recognized in 20x2?

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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Question

ABC Co. started work on an P8,000,000 fixed-price
construction contract in 20x1. Information on the contract is
as follows:
20x2
20x1
2,850,000 3,670,000
Costs incurred per year
Estimated costs to complete 4,275,000 1,630,000
How much profit (loss) is recognized in 20x2?

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