Please do not copy from Chegg. Only attempt if you are sure about the answer. Solve in a step by step manner, explaining each step.

In year 1, Highrise Company contracts to manufacture a piece of customized equipment for a customer. The contract will take two years to complete. The contract price is $250,000 and the company estimates total costs of $220.000. Actual costs incurred are: Year 15121,000Year 2 105,000$226,000 What are the company's gross income and deductions recognized in each of the two years, assuming the company uses (1) the completed contract method and (2) the percentage-of-completion method of accounting for long-term contracts