Answered

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Arizona Desert Homes (ADH) constructed a new subdivision during 2020 and 2021 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $ 3,000,000 Cost: 2020 1,200,000 2021 600,000 Gross profit: 2020 800,000 2021 400,000 Contract billings: 2020 1,500,000 2021 1,500,000 ADH recognizes revenue over time with respect to these contracts. What would be the journal entry made in 2020 to record revenue

Sagot :

abiolataiwo2015

Answer:

Dr Construction $800,000

Dr Cost of construction $1,200,000

Cr Revenue form long-term contracts $2,000,000

Explanation:

Preparation of the journal entry made in 2020 to record revenue.

Based on the information given What would be the journal entry made in 2020 to record revenue is

Dr Construction $800,000

Dr Cost of construction $1,200,000

Cr Revenue form long-term contracts $2,000,000

($800,000+$1,200,000)

(Being to record revenue)

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