PAP-4A Westphal Construction sold to Walker Management Company apartments it had con- structed. The sales price was $2.5 million. Westphal's cost to construct the apartments was $1.6 million. Westphal appropriately uses the installment method. Additional information follows. 2011 2012 2013 Cash Collected $ 800,000 1,200,000 500,000 (a) Determine the gross profit for each year using the installment method. (b) Repeat (a) assuming the construction costs were $1.75 million.

PAP-4A Westphal Construction sold to Walker Management Company apartments it had con- structed. The sales price was $2.5 million. Westphal's cost to construct the apartments was $1.6 million. Westphal appropriately uses the installment method. Additional information follows. 2011 2012 2013 Cash Collected $ 800,000 1,200,000 500,000 (a) Determine the gross profit for each year using the installment method. (b) Repeat (a) assuming the construction costs were $1.75 million.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter8: Revenue Recognition, Receivables, And Advances From Customers

Section: Chapter Questions

Problem 37E

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