On February 1, 2018, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,000,000. During 2018, 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 2019, costs incurred were $2,500,000 with remaining costs estimated to be $3,600,000. 2019 billings were $2,750,000, and $2,475,000 cash was collected. The project was completed in 2020 after additional costs of $3,800,000 were incurred. The company's 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 2018, 2019, and 2020 using the percentage of completion method? 2a. Prepare journal entries for 2018 to record the transactions described (credit "various accounts" for construction costs incurred) 2b. Prepare journal entries for 2019 to record the transactions described (credit "various accounts" for construction costs incurred) 3a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2018. 3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2019. 2020 Recognized in prior Recognized in 2020 To date years Construction 3,555,552 8,000,000 4,444,448 revenue Construction $ 8,300,000 4,544,448 3,755,552 expense Gross profit (loss) (300,000) (100,000) (200,000) Req 2B Req 1 Req 2A Req 3A Req 3B Prepare a partial balance sheet to show the presentation of the project as calculations. Round your answers to the nearest dollar amount.) of December 31, 2018. (Do not round intermediate Balance Sheet (Partial) At December 31, 2018 Current assets: Accounts receivable Costs and profit in excess of billings Current liabilities: Req 2B Req 1 Req 2A Req 3A Req 3B Prepare a partial balance sheet to show the presentation of the project as of December 31, 2019. (Do not round intermediate calculations. Round your answers to the nearest dollar amount.) Balance Sheet (Partial) At December 31, 2019 Current assets: Accounts receivable Current liabilities: Billings in excess of costs less loss