QUESTION 1 Fasttrain Construction Company commences the construction of specialised fast carriages on 1 July 2018. It signs a fixed- price contract for total revenue of $180 million. The project is expected to be completed by the end of June 2021. The expected cost at the commencement of construction was $160 million. The expected costs to complete a construction project can change throughout the project. The following data relates to the project: 2019 2020 2021 (SM) ($M) Costs for the year Costs incurred to date Estimated costs to complete Progress billings during the year Cash collected during the year The contract is completed as expected on 30 June 2021. Fasttrain Construction Company uses the percentage-of- completion method to account for its construction contract REQUIRED a. Compute the gross profit to be recognised for each of the three years. (6 marks) b. Provide the journal entries for each year. Assume the stage of completion can be reliably determined. Exclude journal narrations. (6 marks) c. Prepare the journal entries for each year assuming the stage of completion and the outcome of the construction contract cannot be reliably estimated. Show the differences from b) only. Exclude journal narrations