Basics of amount of contract costs incurred

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On May 1, 2011, Green Construction Company entered into a fixed-price contract to construct an apartment building for $3,000,000. Green appropriately accounts for this contract under the percentage-of-completion method. Information relating to the contract is as follows:

2011 2012
At December 31:
Percentage of completion........ 20% 60%
Estimated costs at completion ... $2,250,000 $2,400,000
Income recognized (cumulative)... $ 150,000 $ 360,000

What is the amount of contract costs incurred during the year ended December 31, 2012?

a. $600,000

b. $960,000

c. $990,000

d. $1,440,000

Reference no: EM13150352

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