1). On June 15, 2021, Sanderson Construction entered into a long-term construction contract to build a baseball stadium in Washington, D.C.., for $220 million.

The expected completion date is April 1, 2023, just in time for the 2023 baseball season, Costs incurred and and estimated costs to complete at year-end for

the life of the contract are as follows ( $ millions).

	2021	2022	2023
Cost incurred during the year	$40	$80	$50
Estimated costs to complete as of December 31	120	60	-

Required:

1. Complete the revenue and gross profit will Sanderson report its 2021, 2022, and 2923 income statements related to this contract

assuming Sanderson recognizes revenue over time according to percentage of completion.

2. Compute the revenue and gross profit will Sanderson report in 2021, 2022, and 2023 income statements related to this contract assuming

this project does not qualify for revenue recognition over time.

3. Suppose the estimated costs to complete at the end of of 2022 are $80 million instead of $60 million. Compute the amount of revenue and

gross profit or loss to be recognized in 2022 assuming Sanderson recognizes revenue over time according to percentage of completion.