1.Howell Co. had the following first-year amounts for a $7,000,000 construction contract:

Actual costs$2,000,000

Estimated costs to complete:$6,000,000

Progress billings:$1,800,000

Cash collected:$1,500,000

What amount should Howard recognize as gross profit (loss) using the percentage-of-completion method?

a.($1,000,000)

b.($200,000)

c.$800,000

d.$1,750,000