Question - Alpha Great Construction was the best selection to build the Stoddard Temple for the amount of $2,500,000. The project broke ground in 2010 and was then completed in 2011. Below the cost and other data are shown below:
Year 2010 2011
Cost incurred during the year $555000 1200000
Estimated cost to complete $1500000 0
Billing during the year $450000 1500000
Cash collections during the year $350000 1400000
Alpha Great Construction is using the percentage of completion method to recognize revenue:
Compute the amount of gross profit recognized in 2010 and 2011.