Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,000,000. The project began in 2018 and was completed in 2019. Data relating to the contract are summarized below:2018 2019Costs incurred during the year $ 300,000 $ 1,575,000Estimated costs to complete as of 12/31 1,200,000 –0–Billings during the year 380,000 1,620,000Cash collections during the year 250,000 1,750,000Required:1. Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming Nortelrecognizes revenue over time according to percentage of completion
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Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,000,000. The project began in 2018 and was completed in 2019. Data relating to the contract are summarized below:
2018 2019
Costs incurred during the year $ 300,000 $ 1,575,000
Estimated costs to complete as of 12/31 1,200,000 –0–
Billings during the year 380,000 1,620,000
Cash collections during the year 250,000 1,750,000
Required:
1. Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming Nortel
recognizes revenue over time according to percentage of completion
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