On February 1, 2016, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,000,000. During 2016, costs of $2,000,000 were incurred with estimated costs of $4,000,000 yet to be incurred. Billings of $2,500,000 were sent, and cash collected was $2,250,000. In 2017, costs incurred were $2,500,000 with remaining costs estimated to be $3,600,000. 2017 billings were $2,750,000, and $2,475,000 cash was collected. The project was completed in 2018 after additional costs of $3,800,000 were incurred. The companys fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion. Required:

1. Compute the amount of revenue and gross profit or loss to be recognized in 2016, 2017, and 2018 using the percentage of completion method?

2016:

-Costruction Revnue and construction Expense a- to date b-recognized in prior years c-recognized in 2016

2017:

-Costruction Revnue and construction Expense a- to date b-recognized in prior years c-recognized in 2017

2018:

-Costruction Revnue and construction Expense a- to date b-recognized in prior years c-recognized in 2018

2-a. Prepare journal entries for 2016 to record the transactions described (credit "various accounts" for construction costs incurred).

2-b. Prepare journal entries for 2017 to record the transactions described (credit "various accounts" for construction costs incurred). 3-a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2016

3-b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2017.