Question

Brovo Construction Company uses the percentage-of-completion method of accounting. In 2015, Brovo began work under a contract with a contract price of

$1,500,000. Other details follow:

2015

2016

Cost incurred during the year

$980,000

$1,375,000

Estimated Cost to complete, as of December 31

420,000

0

Billings to date

800,000

1,500,000

Collections to date

250,000

1,500,000

Prepare all required general journal entries for 2015. (Use 12/31/15 as transaction dates.)

General Journal:

Date

Accounts

Debit

Credit

 

2015

2016

Cost incurred during the year

$980,000

$1,375,000

Estimated Cost to complete, as of December 31

420,000

0

 



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