On February 1, 2016, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,420,000. During 2016, costs of $2,140,000 were incurred with estimated costs of $4,140,000 yet to be incurred. Billings of $2,640,000 were sent and cash collected was $2,390,000.

In 2017, costs incurred were $2,640,000 with remaining costs estimated to be $3,810,000. 2017 billings were $2,890,000 and $2,615,000 cash was collected. The project was completed in 2018 after additional costs of $3,940,000 were incurred. The companys fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion.