Item1 10 points eBook HintPrintReferences Check my work Check My Work button is now enabled10Item 1Item 1 10 points Exercise 5-17 Long-term contract; revenue recognition over time and at a point in time [LO5-9] Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,100,000. The project began in 2018 and was completed in 2019. Data relating to the contract are summarized below: 2018 2019 Costs incurred during the year $ 308,000 $ 1,615,000 Estimated costs to complete as of 12/31 1,232,000 0 Billings during the year 390,000 1,640,000 Cash collections during the year 254,000 1,760,000 Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming Nortel recognizes revenue over time according to percentage of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2018 assuming Nortel recognizes revenue over time according to percentage of completion. 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2018 assuming this project does not qualify for revenue recognition over time.

Required 1 Required 2 Required 3 Required 4 Compute the amount of revenue and gross profit or loss to be recognized in 2018 and 2019 assuming N revenue over time according to percentage of completion. (Loss amounts should be indicated with a mir centages as calculated and rounded in the table below to arrive at your final answer.) = % complete to date Choose numerator Actual costs to date $ 308,000 S 1,615,000 Percentages of completion = Choose denominator Estimated costs to complete = $ 1,232,000 = 0 25.00% 2018 2019 = = 2018 Recognized in prior years To date Recognized in 2018 Construction revenue Construction expense Gross profit (loss) $ $ 2019 Recognized in prior years To date Recognized in 2019 Construction revenue Construction expense Gross profit (loss) $ 0