Assume Deltal Networks contracted to provide a customer with Internet infrastructure for $2,750,000. The project began in 2018 and was completed in 2019. Data relating to the contract are summarized below:

2018 2019

Costs incurred during the year $360,000$2,155,000

Estimated costs to complete as of 12/311,440,0000

Billings during the year500,0001,770,000

Cash collections during the year280,0001,825,000

Required:

1. Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming Delta recognizes revenue over time according to percentage of completion.

2. Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming this project does not qualify for revenue recognition over time.

3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2018 assuming delta recognizes revenue over time according to percentage of completion.

4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2018 assuming this project does not qualify for revenue recognition over time