Popol Construction Company has entered into a contract beginning January 1, 2015, to build a parking complex. It has been estimated that the complex will cost $1,500,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $2,250,000. The following data pertain to the construction period.

	2015	2016	2017
Costs to date	$675,000	$1,125,000	$1,525,000
Estimated costs to complete	825,000	375,000	0
Progress billings to date	675,000	1,375,000	2,250,000
Cash collected to date	600,000	1,250,000	2,250,000

Instructions

1. Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period.
2. Using the cost-recovery method, compute the estimated gross profit that would be recognized during each year of the construction period.