E5-4 : On February 1, 2013 Arrow Construction Company entered into a three year construction contract to build a bridge for a price of OR 8,000,000. During 2013, costs of OR2,000,000 were incurred with estimated costs of OR4,000,000 yet to be incurred. Billing of OR2, 500,000 were sent and cash collected was OR2,250,000. In 2014 cost incurred were OR2,500,000 with remaining cost estimated to be OR3, 600,000 2014 billings were OR2, 750,000 and OR2, 475,000 cash was collected. The project was completed in 2015 after additional costs of OR 3,800,000 were incurred. The company's financial year-end is December 31. Arrow uses the percentage -of- completion method. Required: 1. Calculate the amount of gross profit or loss to be recognized in each of the three years. 2. Prepare journal entries for 2013 and 2014 to record the transactions described.(credit various accounts for construction cost incurred)