During 2017, Pharoah Company started a construction job with a contract price of $1,728,000. The job was completed in 2019. The following information is available. The contract is non-cancellable.

		2017		2018		2019
Costs incurred to date		$432,000		$891,000		$1,155,600
Estimated costs to complete		648,000		297,000		0
Billings to date (non-refundable)		324,000		972,000		1,728,000
Collections to date		291,600		874,800		1,539,000

A)Calculate the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used

Gross Proffit Recognized:

2017 $_________

2018 $__________

2019 $__________

B) Prepare all necessary journal entries for 2018. (Use Accounts Payable for costs incurred to date.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account title and explanation Debit Credit

___________

____________

(To record cost incurred.)

_______________

_______________

(To record billings to date.)

_____________

_____________

(To record collection.)

______________

______________

(To record revenue from long-term contract.)

______________

_______________

(To record construction expenses.)

C) Calculate the amount of gross profit to be recognized each year, assuming the completed-contract method is used. (Do not leave any answer field blank. Enter 0 for amounts.)

Gross profit recognized:

2017 $_________

2018 $_________

2019 $__________