Umbrella Ltd. is constructing a residential building at the Lonsdale Quay for a...
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Umbrella Ltd. is constructing a residential building at the Lonsdale Quay for a contract price of $1,750,000. Construction commenced in early January 2019 and completed in October of 2021. Initially, the costs for this contract were estimated to be $1,500,000. The company uses the percentage of completion method of revenue recognition, using the cost-to-cost method of estimating the percentage complete. The following information is available: 2019 2020 2021 $700,000 Costs incurred each year Estimated costs to complete Billings 0 $150,000 $1,350,000 $900,000 $800,000 $1,050,000 $800,000 $600,000 $600,000 $300,000 $400,000 Collections REQUIRED: Calculate the amount of profit/loss to be recognized in each of 2019, 2020 and 2021. Be sure to show your work. Enter the amount of profit/loss for each of the three years in the space provided below
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