Bywater Construction Contracted to Build a Ship Over a Two

question 10

Essay

Bywater Construction contracted to build a ship over a two year period. The contract price was $21,000,000 with an estimate total cost of $18,400,000. The following cost data relate to the construction period.

Prepare the necessary journal entries for 2011, 2012, and 2013 assuming Bywater uses the percentage-of-completion method.

Understand the concept of profit maximization in the product life cycle stages.

Comprehend the limitations of cost-plus pricing in profit maximization.

Recognize the characteristics of price elasticity throughout the product life cycle.

Identify the benefits of unbundling strategies in price-sensitive markets.

---

Definitions:

Moment-By-Moment Awareness

The practice of being fully aware of the present moment, commonly associated with mindfulness and mediation practices.

Personalized

Tailored or customized to meet the specific needs, preferences, or interests of an individual.

Measureable

Capable of being quantified or expressed as a numerical value, allowing for precise assessments or comparisons.

Introspection

The examination or observation of one's own mental and emotional processes.