Super Good Corp. contracted to build a bridge for $ 5,000,000. Construction began in 2020 and was completed in 2021. Data relating to the construction are:

2020 2021

Costs incurred....................................................................... $ 1,620,000 $ 1,400,000

Estimated costs to complete................................................... 1,380,000

Instructions

Using the percentage-of-completion method and the cost-to-cost basis

a) How much revenue should be reported for 2020? Show your calculation.

b) Prepare the journal entry to record progress billings of $ 1,700,000 during 2020.

c) Prepare the journal entry to record the revenue and gross profit for 2020.

d) How much gross profit should be reported for 2021? Show your calculation.