Arizona Desert Homes (ADH) constructed a new subdivision during 2020 and 2021 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $ 2,730,000 Cost: 2020 1,140,000 2021 540,000 Gross profit: 2020 710,000 2021 340,000 Contract billings: 2020 1,365,000 2021 1,365,000 ADH recognizes revenue upon completion of the contract. In its December 31, 2020, balance sheet, ADH would report: Multiple Choice The contract liability, billings in excess of cost, of $225,000. The contract asset, contract amount in excess of billings, of $1,365,000. The contract asset, cost and profits in excess of billings, of $485,000. The contract asset, deferred profit, of $340,000.