Assume Miami Fiber Optics contracted to provide a customer with Internet infrastructure for $4,000,000. The project began in Year 1 and was completed in Year 2. Data relating to the contract are summarized below: Contract amount $4,000,000 Year 1 Year 2 Costs incurred during the year Estimated costs to complete as of 12/31 $800,000 $2,400,000 $2,300,000 $0 Billings during the year Cash collections during the year $3,150,000 $3,500,000 $850,000 $500,000 1. Compute the amount of revenue and gross profit or loss to be recognized in Year 1 and Year 2, assuming Miami Fiber Optics recognizes revenue over time according to percentage of completion. Percentage of completion Construction revenue Construction expense Gross profit (loss) Year 1 Year 2 Total 25% 100% $1,000,000 $0 800,000 $200,000 0 $0 $1,000,000 800,000 $200,000 2. Compute the amount of revenue and gross profit or loss to be recognized in Year 1 and Year 2, assuming this project does not qualify for revenue recognition over time. Construction revenue Construction expense Gross profit (loss) Year 1 Year 2 Total $0 $4,000,000 $4,000,000 0 3,100,000 3,100,000 $0 $900,000 $900,000 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of Year 1, assuming Miami FiberOptics recognizes revenue over time according to percentage of completion. Balance sheet (Partial) at December 31, Year 1 Current Assets: Accounts receivable CIP in excess of billings Current Liabilities: Billings in excess of CIP $350,000 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of Year 1, assuming this project does not qualify for revenue recognition over time. Balance sheet (Partial) at December 31, Year 1 Current Assets: Current Liabilities: