On June 15, 2021, Red Sox Construction entered into a long-term construction contract to build a new baseball stadium in Boston., for $240 million. The expected completion date is April 1, 2023, just in time for the 2023 baseball season. Costs incurred in the first two years and estimated remaining costs to complete the project are as follows ($ in millions):

20212022

Costs incurred during the current year $40 $90

Estimated future costs to complete 120 70

Required:

a. Compute the revenue and gross profit Red Sox Construction will report in year 2021 and 2022, using the percentage of completion method.

b. Provide journal entry to record revenue and gross profit for 2022.