@aatoural – Here are the % Completion JEs from my Wiley text. They are “summary journals” so the first one could have many different credit accounts – the rest (I think) are pretty much standard.
To record cost of construction:
DR Costruction in Process
……CR Various accounts (materials, payables, labor, etc.
To record progress billings:
DR Accounts Receivable
……CR Billings on Construction in Progress
To record collection
DR Cash
……CR Accounts Receivable
They mention using some nominal accounts to close out the year and incorporate profit, saying “…debits gross profit … to Construction in Process. Similarly it credits Revenue from Long Term Contracts. It then debits the difference between the amounts recognized each year for revenue and gross profit to a nominal account, Construction Expenses (similar to Cost of Goods Sold in a manufacturing company). It reports that amount in the income statement as the actual cost of construction incurred that period.
To recognize revenue and gross profit:
DR Construction in Process (gross profit)
DR Construction Expenses
……CR Revenue from Long-Term Contracts
To record completion of the Contract:
DR Billings on Construction in Progress
……CR Construction in Progress
AUD - 95
BEC - 82
FAR - 86
REG - 82
Started prep using
Becker live classes then switched to self-paced
.
