Use the Following Information for the Following Questions:
Hemsworth Ltd

question 51

Multiple Choice

Use the following information for the following questions:
Hemsworth Ltd. began work in 2020 on a contract for $ 960,000. Other details follow:
$\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad \quad\quad\quad \underline{2020}\quad \quad\quad \quad\underline{2021}$
$\text{Costs incurred during the year}\ldots \ldots \ldots \ldots \ldots \ldots \ldots\ldots \ldots \ldots \ldots \ldots \ldots \ldots\$160,000\quad \quad\$490,000$
$\text{Estimated costs to complete as of December 31}\ldots \ldots \ldots \ldots \ldots \ldots \ldots\ldots \ldots480,000\quad \quad0$
$\text{Billings during the year }\ldots\ldots \ldots \ldots \ldots\ldots\ldots \ldots \ldots \ldots\ldots \ldots \ldots \ldots \ldots \ldots \ldots 180,000\quad \quad720,000$
$\text{Collections during the year}\ldots\ldots \ldots \ldots \ldots\ldots\ldots \ldots \ldots \ldots\ldots \ldots \ldots \ldots \ldots \ldots 150,000\quad \quad975,000$
-Assume that Hemsworth uses the percentage-of-completion method of accounting. The portion of the total gross profit to be recognized in 2020 is

• A) $ 60,000.
• B) $ 80,000.
• C) $ 240,000.
• D) $ 320,000.

---

Definitions:

Fertile Crescent

A historical region in the Middle East known for its rich soils and contributions to early agricultural development and civilization.

Teotihuacan

An ancient Mesoamerican city located in what is now Mexico, known for its vast size, complex urban planning, and monumental structures such as the Pyramid of the Sun and the Pyramid of the Moon.

Solar Calendar

A calendar system based on the Earth's rotation around the Sun, typified by a year of twelve months.

Teotihuacan

An ancient Mesoamerican city located in what is now Mexico, known for its vast size, complexity, and the remains of its large pyramids and temples.