Hansen Construction, Inc. has consistently used the percentage-of-completion method of recognizing income. During 2006, Hansen started work on a $3,000,000 fixed-price construction contract. The accounting records disclosed the following data for the year ended December 31, 2006:
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|
Costs incurred |
$ 930,000 |
|
Estimated cost to complete |
2,170,000 |
|
Progress billings |
1,100,000 |
|
Collections |
700,000 |
How much loss should Hansen have recognized in 2006?
- $230,000
- $100,000
- $ 30,000
- $0