Davis Construction company was a low bidder on a construction project to build and earthen dam for $2,000,000. The project was begun in 2017. Cost and other are presented bellow.

2017 2018

Costs incurred during the year $450,000 $1,100,000

Total costs 1,050,000 50,000

Percentage of completion 30% 96.875%

Billings during the year 500,000 1,400,000

Cash collections during the year 400,000 1,400,000

Assume the Beavis recognizes revenue on the contract over time according to percentage of completion

Required

1. Compute the amounts of revenue and gross profit (or loss) to be recognized in 2017 and 2018. Please label whether it is a profit or loss.