Completed-Contract Method
Broncos Construction Ltd Each of the Above Contracts Is with a Different Customer

question 70

Essay

Completed-contract method
Broncos Construction Ltd. reported the following construction activity in 2020, their first year of operations:
$\begin{array}{c}\begin{array}{c}\\\\\\\underline{\text {Contract}}\\\text {X}\\\text {Y}\\\text {Z}\\\\ \end{array}\begin{array}{c}\\\text { Total}\\\text { Contract}\\\underline{\text { Price }} \\ \$ 260,000 \\ 325,000 \\ \underline{388,000} \\\underline{ \$ 973,000} \\\end{array}\begin{array}{c}\\\text {Billings }\\\text {through}\\\underline{12 / 31 / 17 }\\\$ 170,000 \\130,000 \\\underline{388,000} \\\underline{\$688,000} \\\end{array}\begin{array}{c}\text {Cash}\\\text {collections}\\\text { through}\\\underline {12 / 31 / 17 }\\ \$ 155,000 \\ 130,000 \\ \underline{ 316,000} \\ \underline{ \$ 601,000 }\end{array}\begin{array}{c}\text {Costs}\\\text {Incurred}\\\text { through}\\\underline{12 / 31 / 17 }\\ \$ 182,000 \\ 100,000 \\\underline{ 252,000} \\ \underline{ \$ 534,000 }\end{array}\begin{array}{c}\text {Estimated}\\\text {Additional}\\\text {Costs to}\\\underline{\text {Complete}}\\\$ 63,000 \\247,000\\\underline{-0-}\\\underline{\$ 310,000}\end{array}\end{array}$

Each of the above contracts is with a different customer, and any work remaining at December 31, 2020 is expected to be completed in 2021.
Instructions
Prepare a partial income statement and a partial statement of financial position to indicate how the above contract information would be reported. Broncos use the completed-contract method.

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Definitions:

Tchebysheff's Theorem

A statistical rule stating that for any dataset, regardless of distribution, a certain minimum percentage of values must lie within a specified number of standard deviations from the mean.

Population Mean

A calculation of the central value among all data points in a population.

Sample Mean

The average of a set of numerical values taken from a sample.

Grouped Data

Data that has been organized into groups or categories, often to simplify analysis and identify patterns within the data set.