ABC Construction Company undertakes large-scale infrastructure projects. Financial data for 2023 is detailed below:

Ledgers:

• Contract Revenues: $50,000,000
• Construction Costs: $35,000,000
• General and Administrative Expenses: $5,000,000
• Depreciation Expense: $2,000,000

Requirements:

• Prepare ABC Construction Company's income statement for the year ended December 31, 2023.
• Calculate the Gross Profit and Operating Income.
• Determine the Net Income after taxes using a tax rate of 25%.
• Analyze the impact of depreciation on ABC Construction Company's profitability.
• Discuss how contract variations affect project profitability and financial reporting.