During 2014, Nilsen Company started a construction job with a contract price of $1,936,000. The job was completed in 2016. The following information is available.

| |2014 |2015 |2016

|Costs incurred to date |$484,000 |$998,250 |$1,294,700

|Estimated costs to complete|$726,000|$332,750 |$0

|Billings to date|$363,000|$1,089,000|$1,936,000

|Collections to date|$326,700|$980,100|$1,724,250

a. Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.

b. Prepare all necessary journal entries for 2015, assuming all costs are on account.

Do not copy from Chegg and give complete answer with explanation