Windham Construction Company uses the percentage of completion method of accounting. In 2018 Windham started work on a two-year contract with a total price of $15,000,000. Data for 2018 and 2019 are presented below: (Follow GAAP)

2018 2019

Costs incurred to date $7,200,000 $12,050,000

Estimated costs to complete 4,800,000 - 0 -

Billings during the year 6,000,000 9,000,000

Collections during the year 4,200,000 8,900,000

(a) How much revenue should be reported for 2018?

(b) What is the total amount of gross profit that will be reported on this contract?

(c) Make the journal entries to record the 2018 costs incurred under the contract, the billings,

the collections and the year-end entry to record the 2018 revenues, expenses and gross

profit.