Contract-Based Approach
in January 2020, Bruins Construction Corp $\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\underline{2020}\quad\quad\quad\quad\underline{2021}$ $\text{Costs incurred}\ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots\ldots\$2,430,000\quad\$2,270,000$

question 13

Essay

Contract-based approach
In January 2020, Bruins Construction Corp. contracted to construct a building for $ 6,000,000. Construction started in early 2020 and was completed in 2021. The following additional information is available:
$\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\underline{2020}\quad\quad\quad\quad\underline{2021}$
$\text{Costs incurred}\ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots\ldots\$2,430,000\quad\$2,270,000$
$\text{Estimated costs to complete}\ldots \ldots \ldots \ldots\ldots2,600,000 \quad -$
$\text{Collections during the year}\ldots \ldots \ldots \ldots \ldots \ldots2,400,000\quad3,600,000$ Bruins uses the percentage-of-completion method.
Instructions
Under the contract-based approach,
a) How much revenue should Bruins report for 2020 and 2021?
b) Prepare all journal entries for 2020 and 2021 for this contract.

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Definitions:

Management Levels

Refers to the different layers of management in an organization, typically consisting of top-level (executive), middle-level, and lower-level (or first-line) managers.

Conceptual Skills

The ability to understand complex concepts and their implications, crucial for strategic planning and problem-solving in management.

Technical Skills

The abilities and knowledge needed to perform specific tasks, often related to IT, engineering, mechanics, or other technical fields.

Conceptual Skills

The ability to understand complex ideas, identify patterns, and solve problems abstractly, critical for strategic planning and decision making.