1) A construction company entered into a fixed-price contract to build an office building for $44 million. Construction costs incurred during the first year were $14 million and estimated costs to complete at the end of the year were $21 million. During the first year the company billed its customer $16 million, of which $10 million was collected before year-end.

What would appear in the year-end balance sheet related to this contract using the percentage-of-completion method? (Enter your answers in whole dollars.)

2) Franklin Construction entered into a fixed-price contract to build a freeway-connecting ramp for $50 million. Construction costs incurred in the first year were $40 million and estimated remaining costs to complete at the end of the year were $25 million.

- How much gross profit or loss will Franklin recognize in the first year if it recognizes revenue over time according to percentage of completion method? (Enter your answer in millions.)

- How much gross profit or loss will Franklin recognize in the first year applying the completed contract method? (Enter your answer in millions.)