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Must Solve Problems - Mas

JGG Builders Corp. entered a contract on January 2, 2008, to construct a building for P40,000,000, with several change orders accepted during the construction. The document provides a summary of costs incurred and estimated costs to complete for both the basic contract and change orders. It seeks to calculate the gross profit to be recognized by December 31, 2008, using the percentage of completion method.

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Juliana Cheng
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19 views4 pages

Must Solve Problems - Mas

JGG Builders Corp. entered a contract on January 2, 2008, to construct a building for P40,000,000, with several change orders accepted during the construction. The document provides a summary of costs incurred and estimated costs to complete for both the basic contract and change orders. It seeks to calculate the gross profit to be recognized by December 31, 2008, using the percentage of completion method.

Uploaded by

Juliana Cheng
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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MUST SOLVE PROBLEMS

MANAGEMENT ADVISORY SERVICE

On January 2, 2008, JGG


Builders Corp. of Ilocos enters
into a contract to construct a
building for P
40,000,000. During the
construction period many
change orders are made to the
original contract. All of
the changes were accepted by
both the customer and the
contractor. The following
schedule
summarizes the change orders
in 2008:
Cost Incurred Estimated Costs
Contract
In 2008 to Complete Price
Basic Contract 8,000,000
28,000,000 40,000,000
Change order # 1 50,000
50,000 125,000
Change order # 2 - 50,000 -
Change order # 3 300,000
300,000 600,000
Change order # 4 125,000 -
100,000
Under the percentage of
completion method, what is the
gross profit to be recognized on
December 31,
2008 (Rounded to the nearest
peso)?
On January 2, 2008, JGG
Builders Corp. of Ilocos enters
into a contract to construct a
building for P
40,000,000. During the
construction period many
change orders are made to the
original contract. All of
the changes were accepted by
both the customer and the
contractor. The following
schedule
summarizes the change orders
in 2008:
Cost Incurred Estimated Costs
Contract
In 2008 to Complete Price
Basic Contract 8,000,000
28,000,000 40,000,000
Change order # 1 50,000
50,000 125,000
Change order # 2 - 50,000 -
Change order # 3 300,000
300,000 600,000
Change order # 4 125,000 -
100,000
Under the percentage of
completion method, what is the
gross profit to be recognized on
December 31,
2008 (Rounded to the nearest
peso)?
1.

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