MD Construction entered into a contract beginning January 1, 2010 to build a parking complex. It has been estimated that the complex will cost P600,000 and will take three years to construct. The complex will be billed at P900,000. The following data pertain to the construction period. 2010 2011 2012 Cost to date P270,000 P420,000 P600,000 Estimated cost to complete Progress billings to date 330,000 180,000 550,000 -0- 270,000 240,000 900,000 Cash collected to date 500,000 900,00 During 2010, costs incurred include P30,000 standard materials stored at the site to be used in 2012 to complete the project. Using percentage-of-completion method, compute the gross profit that should be recognized in 2011:

MD Construction entered into a contract beginning January 1, 2010 to build a parking complex. It has been estimated that the complex will cost P600,000 and will take three years to construct. The complex will be billed at P900,000. The following data pertain to the construction period. 2010 2011 2012 Cost to date P270,000 P420,000 P600,000 Estimated cost to complete Progress billings to date 330,000 180,000 550,000 -0- 270,000 240,000 900,000 Cash collected to date 500,000 900,00 During 2010, costs incurred include P30,000 standard materials stored at the site to be used in 2012 to complete the project. Using percentage-of-completion method, compute the gross profit that should be recognized in 2011:

Name: a. 75,000b. 195,000c. 120,000d. 300,000 MD Construction entered into a
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Description: a. 75,000b. 195,000c. 120,000d. 300,000 MD Construction entered into a contract beginning January 1, 2010 to build a parkingcomplex. It has been estimated that the complex will cost P600,000 and will take threeyears to construct. The complex will be

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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