On February 1, 2010, Marsh Contractors agreed to construct a building at a contract price of $6,000,000. Marsh estimated total construction costs would be $4,000,000 and the project would be finished in 2012. Information relating to the costs and billings for this contract is as follows:
2010 2011 2012

Total costs incurred to date $1,500,000 $2,640,000 $4,600,000

Estimated costs to complete 2,500,000 1,760,000 -0-

Customer billings to date 2,200,000 4,000,000 5,600,000

Collections to date 2,000,000 3,500,000 5,500,000

Instructions
Fill in the correct amounts on the following schedule. For percentage-of-completion accounting and for completed-contract accounting, show the gross profit that should be recorded for 2010, 2011, and 2012. And, record the journal entries to close the contracts both under the percentage-of-completion and completed contract methods upon completion.
Percentage-of-Completion Completed-Contract
Gross Profit Gross Profit
2010 2010
2011 2011
2012 2012