Amount of revenue recognize


Wynn, Inc. has a contract to construct a large hotel for $12,000,000. The contract was signed on January 2, 2010 and it was expected that the hotel would be complete on December 31, 2013. At the date the contract was signed, Wynn, Inc. anticipated the costs of construction would total $11,000,000. At the end of 2011 the costs incurred were $3,490,000 and its estimate of total contract costs rose to $11,870,000. During 2012, the company incurred costs of $4,020,000 and by the end of 2012 the total cost estimate rose to $12,400,000. Due to certain circumstances, Wynn, Inc. believes there are inherent hazards in the contract beyond the normal, recurring business risks. Wynn, Inc. expects to recover all its costs under the contract. Under these conditions, what amount of revenue should Wynn, Inc. recognize in each of the following years?

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Accounting Basics: Amount of revenue recognize
Reference No:- TGS047216

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