On July 1, 2014, Jiaqian Company entered into a contract to build an apartment building. It is estimated that the building will cost $6,000,000 and will take 3 years to complete. The contract price was $7,800,000. The following information pertains to the construction period. Instructions (a) Compute the amount of gross profit to be recognized each year, assuming the percentage-of- completion method is used. (b) Prepare all necessary journal entries for 2016. (c) Prepare a partial balance sheet for December 31, 2015, showing the balances in the receivables and inventory accounts.

	2014	2015	2016
costs to date	2000000	4060000	6200000
Estimated costs to complete	4000000	1740000	0
progress billings to date	1200000	4800000	7800000
cash collected to date	900000	4200000	7680000