Creative Robotics Inventions Inc. (CRA Inc.) is building a flying personal vehicle for a contract...
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Creative Robotics Inventions Inc. (CRA Inc.) is building a flying personal vehicle for a contract price of $360,000,000. This is estimated to be a three-year project with an estimated cost of $300,000,000. CRA Inc. uses the percentage of completion method of revenue recognition, using the engineering estimates to determine the percentage of work completed. The following is the best available information at the end of each year: ('000) Costs incurred each year Estimated costs to complete Completion estimates Required: Year 1 63,000 245,500 20% Year 2 126,500 173,500 55% Year 3 143,600 0 100% Prepare journal entries to recognize income and expenses over the project's life. (10 marks)
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