In 2021, Vine Co. enters into a contract to construct a building for a customer. Vine identifies its performance obligation to be satisfied over time. Vine measures its progress on the contract based on costs incurred. The contract price is P10M. Vine has an unconditional right to all billings made in accordance with the billing schedule stated in the contract. Information on the construction is provided below:

YEARS 2021 2022 2023

Contract costs incurred to date

3,150,000. 5,680,000. 7,120,000

Billings per year

4,000,000. 5,000,000. 1,000,000

Collections on billings per year

3,600,000. 4,500,000. 1,900,000

Vine cannot reasonably measure the outcome of the performance obligation but expects to recover all contract costs incurred.

Compute for the gross profit in 2022.

Compute for the gross profit in 2023.