Hillier Construction Ltd commenced the construction of a building on 1 July 2013.It has a fixed-price contract for total revenues of $45 million.The expected completion date is 30 June 2016.The expected total cost to Hillier Construction at the beginning of the project is $35 million.The following information relates only to the construction of this building:

\begin{array} { | l | r | r | r | } \hline \text { For the year ending } 30 \text { June } & \begin{array} { r } 2014 \\( \$ 000 )\end{array} & \begin{array} { r } 2015 \\( \$ 000 )\end{array} & \begin{array} { r } 2016 \\( \$ 000 )\end{array} \\\hline \text { Costs for the year } & 12500 & 15000 & 10000 \\\hline \text { Costs incurred to date } & 12500 & 27500 & 37500 \\\hline \text { Estimated costs to complete } & 23000 & 8500 & - \\\hline \text { Progress billings during the year } & 10000 & 12000 & 23000 \\\hline \text { Cash collected during the year } & 10000 & 11000 & 24000 \\\hline\end{array}

Hillier Construction uses the percentage-of-completion method based on cost to account for its construction contracts.What are the journal entries for the year ended 30 June 2014 (rounded to the nearest $000)?
A)

\begin{array} { | l | l | r | r | } \hline & & \$ 000 & \$ 000 \\\hline \mathrm { Dr } & \text { Construction expenses } & 12500 & \\\hline \mathrm { Cr } & \text { Materials, cash, etc. } & & 12500 \\\hline & & & \\\hline \mathrm { Dr } & \text { Accounts receivable } & 10000 & \\\hline \mathrm { Cr } & \text { Revenue from long-term contract } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Cash } & 10000 & \\\hline \mathrm { Cr } & \text { Accounts receivable } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Construction in progress } & 3345 & \\\hline \mathrm { Cr } & \text { Gross profit on construction contract } & & 3345 \\\hline\end{array}

\begin{array} { | l | l | r | r | } \hline & & \$ 000 & \$ 000 \\\hline \mathrm { Dr } & \text { Construction in progress } & 12500 & \\\hline \mathrm { Cr } & \text { Materials, cash, etc. } & & 12500 \\\hline & & & \\\hline \mathrm { Dr } & \text { Accounts receivable } & 10000 & \\\hline \mathrm { Cr } & \text { Revenue from long-term contract } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Cash } & 10000 & \\\hline \mathrm { Cr } & \text { Accounts receivable } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Construction in progress } & 3571 & \\\hline \mathrm { Dr } & \text { Construction expenses } & 12500 & \\\hline \mathrm { Cr } & \text { Revenue from long-term contract } & & 16071 \\\hline\end{array}

\begin{array} { | r | l | r | r | } \hline & & \$ 000 & \$ 000 \\\hline \mathrm { Dr } & \text { Construction in progress } & 12500 & \\\hline \mathrm { Cr } & \text { Materials, cash, etc. } & & 12500 \\\hline & & & \\\hline \mathrm { Dr } & \text { Accounts receivable } & 10000 & \\\hline \mathrm { Cr } & \text { Billings on construction in progress } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Cash } & 10000 & \\\hline \mathrm { Cr } & \text { Accounts receivable } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Construction in progress } & 3345 & \\\hline \mathrm { Dr } & \text { Construction expenses } & 12500 & \\\hline \mathrm { Cr } & \text { Revenue from long-term contract } & & 15845 \\\hline\end{array}

\begin{array} { | l | l | r | r | } \hline & & \$ 000 & \$ 000 \\\hline \mathrm { Dr } & \text { Construction in progress } & 12500 & \\\hline \mathrm { Cr } & \text { Materials, cash, etc. } & & 12500 \\\hline & & & \\\hline \mathrm { Dr } & \text { Accounts receivable } & 10000 & \\\hline \mathrm { Cr } & \text { Billings on construction in progress } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Cash } & 10000 & \\\hline \mathrm { Cr } & \text { Accounts receivable } & & 10000 \\\hline & & & \\\hline \mathrm { Dr } & \text { Construction expenses } & 12500 & \\\hline \mathrm { Cr } & \text { Revenue from long-term contract } & & 12500 \\\hline\end{array}

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