Nichols Construction Company (NCC)entered into a Contract to Build a Shopping

question 67

Multiple Choice

Nichols Construction Company (NCC) entered into a contract to build a shopping complex for $1,900,000. Construction commenced on July 1, 2020, with a planned completion date of December 31, 2022. A summary of the related accounting information is provided below: $$\begin{array} { | l | r | r | r | } \hline & \mathbf { 2 0 2 0 } & \mathbf { 2 0 2 1 } & \mathbf { 2 0 2 2 } \\\hline \text { Costs incurred during the year } & 400,000 & 500,000 & 650,000 \\\hline \text { Estimated costs to complete at year end } & 1,200,000 & 600,000 & 0 \\\hline \text { Billings during the year } & 560,000 & 640,000 & 600,000 \\\hline \text { Cash collections during the year } & 500,000 & 310,000 & 990,000 \\\hline\end{array}$$ How much would the balance in accounts receivable be on the balance sheet of NCC at the end of 2021 if NCC uses the percentage of completion method?

• A)$130,000
• B)$390,000
• C)$790,000
• D)$1,100,000

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Definitions:

Patellar Reflex

A reflex action that causes the lower leg to kick forward when the patellar tendon just below the kneecap is tapped; a measure of the function of the nervous system.

Spinal Segments

Sections of the spinal cord that correspond to the vertebrae, from which spinal nerves emerge to innervate specific areas of the body.

Myelin

A fatty substance that surrounds and insulates the axons of some neurons, allowing for faster transmission of electrical signals along the nerve cells.

Endoneurium

The delicate connective tissue surrounding each nerve fiber within a peripheral nerve, providing mechanical and physiological support to individual axons.