On January 1, 2018, MINDY CONSTRUCTION COMPANY accepted a long-term construction project to construct a building with an initial contract price of $10M. The outcome of the construction project can be estimated reliably and the contractor decided to employ cost-to-cost method. During 2020, the contract price increases due to change in the project design requested by the client. The following data are provided by the accountant and project manager concerning the construction costs for the three years of construction: 12/31/2018 12/31/2019 12/31/2020 Cumulative costs 1,000,000 ? 10,800,000 incurred as of the end of the year Realized Gross/Loss 2 350,000 (1,600,000) during the year Percentage of 12.5% 60 % 90 % completion as of the end of the year