The Build-It Construction Company enters into a contract on January 1, 2013, to construct a 20-story office building for $42,000,000. During the construction period, many change orders are made to the original contract. The following schedule summarizes the changes made in 2013.

Compute the revenues, costs, and gross profit to be recognized in 2013, assuming use of the cost-to-cost method to determine the percentage completed.

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Cost Incurred- 2013 Estimated Cost to Complete Contract Price Change Order 1 Change Order 2 Change Order 3 50,000 0 300,000 ,000,oo0 50,000 50,000 300,000 $42,000,000 125,000 0 Still to be negotiated; at least cost. Change Order 4 125,000 0 100,000