2. [Contract accounting; CFA adapted] On December 31, 1999, LAS Construction entered into a major long-term con- struction with the following terms: Total contract price $3,000,000 Total expected cost $2.400,000 Construction is expected to take three years. Production costs and cash flows are shown in the following table: Year 2000 2001 2002 Totals Projected Production Costs and Cash Flows Costs Incurred $ 900.000 800,000 700,000 $2,400,000 Cash Received $1,000,000 1,000,000 1,000,000 $3,000,000

a. Show the revenue and pretax income for each year under both the percentage-of-completion and completed contract methods.