Refer to Craft Construction. Assume that Craft uses the completed-contract method for revenue recognition. Make the appropriate journal entries for 2016 and 2017 for Craft Company
What will be an ideal response?
Answer:
2016
Construction in Progress
225,000
Cash or A/P
225,000
Accounts Receivable
200,000
Billings on Construction
200,000
Cash
150,000
Accounts Receivable
150,000
Cost of Construction
225,000
Revenue
225,000
2017
Construction in Progress
550,000
Cash or A/P
550,000
Accounts Receivable
700,000
Billings on Construction
700,000
Cash
750,000
Accounts Receivable
750,000
Cost of Construction
550,000
Construction in Progress
125,000
Revenue
675,000
Billings in construction contract
900,000
Construction in Progress
900,000
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