Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,800,000. The project was begun in 2012 and completed in 2013. Cost and other data are presented below:

2012 2013

Costs incurred during the year $450,000 $ 1.100,000

Estimated costs to complete 1,050,000 0

Billings during the year 400,000 1,400,000

Cash collections during the year 300,000 1,500,000

Assume that Beavis uses the percentage- of- completion method for revenue recognition.

Required:

Compute the amount of gross profit recognized during 2012 and 2013.

Prepare all journal entries related to the construction project in 2012 and 2013.

Prepare Statement of Financial Position end of 2012 and 2013 (if any).

(please provide the answer step by step)