Answer:
Gross profit to be recognized = $196,140
Explanation:
Headland Inc.
Gross profit to be recognized by Headland at December 31, 2014 ending
Estimated contract cost $1,962,000
Fixed fee $467,000
Total $1,962,000+ $467,000) $2,429,000
Total estimated cost $1,962,000
Gross profit ($2,429,000- $1,962,000) $467,000
percentage of completion:( $829,900/1,962,000) 42%
Gross profit to be recognized: $467,000*42% $196,140
