Answer:
revenue recognized
2018 = $2,800,000
2019 = $4,500,000
2020 = $2,700,000
gross profit
2018 = $616,000
2019 = $990,000
2020 = $383,400
Explanation:
Percentage of 2018 2019 2020
completion method
Cost incurred in $0 $2,184,000 $5,694,000
previous year
+ Cost incurred $2,184,000 $3,510,000 $2,316,600
during the year
Total cost incurred $2,184,000 $5,694,000 $8,010,600
+ Estimated cost to $5,616,000 $2,106,000 $0
be incurred
Total estimated cost $7,800,000 $7,800,000 $8,010,600
to be incurred
Percentage of 28% 73% 100%
completion
Total revenue $10,000,000 $10,000,000 $10,000,000
Total revenue $2,800,000 $7,300,000 $10,000,000
recognized (% of completion x total revenue)
- Revenue recognized ($0) ($2,800,000) ($7,200,000)
in previous year
= revenue recognized $2,800,000 $4,500,000 $2,700,000
in current year
gain/loss 2018 2019 2020
Revenue $2,800,000 $4,500,000 $2,700,000
- Cost incurred ($2,184,000) ($3,510,000) ($2,316,600)
Gross profit $616,000 $990,000 $383,400
