Exercise $6-20($Algo$)$ Long$-$term contract; revenue recognition over time vs$.$ upon project completion

$[$L$06-9]$

On June $15,2024,$ Sanderson Construction entered into a long$-$term construction contract to build a baseball stadium in Washington,

D$.$C$.,$ for $$320$ million. The expected completion date is April $1,2026,$ just in time for the $2026$ baseball season. Costs incurred and

estimated costs to complete at year$-$end for the life of the contract are as follows $($$ in millions$)$:

Required:

Compute the revenue and gross profit that Sanderson will report in its $2024,2025,$ and $2026$ income statements related to this

contract, assuming Sanderson recognizes revenue over time according to percentage of completion.

Compute the revenue and gross profit that Sanderson will report in its $2024,2025,$ and $2026$ income statements related to this

contract, assuming this project does not qualify for revenue recognition over time.

Suppose the estimated costs to complete at the end of $2025$ are $$120$ million instead of $$70$ million. Compute the amount of

revenue and gross profit or loss to be recognized in $2025,$ assuming Sanderson recognizes revenue over time according to

percentage of completion.

Complete this question by entering your answers in the tabs below.

Compute the revenue and gross profit that Sanderson will report in its $2024,2025,$ and $2026$ income statements related to this contract,

assuming Sanderson recognizes revenue over time according to percentage of completion.

Note: Enter your answer in millions $($i$.$e$.,$ $$4,000,000$ should be entered as $$4).$ Loss amounts should be indicated with a minus sign. Use

percentages as calculated and rounded in the table below to arrive at your final answer.