BE$6\mathrm{.}36($LO $10,12,14)$ During $2023,$ Darwin Corporation started a construction job with a contract price of $$4\mathrm{.}2$ million. Darwin ran into severe technical difficulties during construction but managed to complete the job in $2025.$ The contract is non$-$cancellable. Under the terms of the contract, Darwin sends billings as revenues are earned. Billings are non$-$refundable. The following information is available:

$202320242025$

Costs incurred to date $$600,000$ $$2,100,000$ $$4,100,000$

Estimated costs to complete $3,150,0002,100,0000$

Calculate the amount of gross profit that should be recognized each year under the percentage$-$of$-$completion method.

Prepare the year$-$end journal entries for $2024$ to record revenues and expenses from the contract, assuming the percentage$-$of$-$completion method is used. Explain the treatment of the reduction in overall gross profit under the percentage$-$of$-$completion method.

Calculate the amount of gross profit or loss that should be recognized each year under the completed$-$contract method. Explain the treatment of losses under the completed$-$contract method.