Sherman Construction Company was awarded a contract to construct an interchange at the junction of U.S. 66 and Highway 40 at a total contract price of $8,000,000. The estimated total costs to complete the project were $6,000,000.
Instructions:
a. Make the entry to record construction costs of $3,600,000, on construction in process to date.
b. Make the entry to record progress billings of $2,000,000.
c. Make the entry to recognize the profit that can be recognized to date, on a percentage-of-completion basis.