During 2020, Ayayai Corporation started a construction job with a contract price of $5.46 million. Ayayai ran
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Question:
During 2020, Ayayai Corporation started a construction job with a contract price of $5.46 million. Ayayai ran into severe technical difficulties during construction but managed to complete the job in 2022. The contract is non-cancellable. Under the terms of the contract, Ayayai sends billings as revenues are earned. Billings are non-refundable. The following information is available:
Costs incurred to date Estimated costs to complete 2020 $ 780,000 4,095,000 2021 $2,730,000 2,730,000 2022 $5,360,000 -0- (a) Calculate the amount of gross profit that should be recognized each year under the percentage-of-completion method. (En or parentheses e.g. (45).) 2020 2021 2022 Gross profit / (loss) $ $
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