XYZ Construction Company has contacted to build and office building. The construction is scheduled to begin on 1/1/15, and the estimated time of completion is 7/1/18. The building cost is estimated to be $40,000,000,000 and will be billed at $48,000,000. The following data relate to the construction period.

Required:

a. Compute the estimated gross profit for 2015, 2016, 2017, and 2018 assuming that the percentage ?of-completion method is used.

b. Prepare the necessary journal entries for XYZ for the year 2017 and 2018.

c. Show the relevant balance sheet and income statement sections for 2017.

Costs to date Estimated cost to complete Progress billings to date Cash collected to date 2015 2016 2017 2018 -0- $11,000,000 $20,000,000 $27,000,000 $40,000,000 29,000,000 20,000,000 13,000,000 6,000,000 18,000,000 28,000,000 6,000,000 15,000,000 25,000,000 48,000,000 48,000,000