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Question - During 2020, Indigo Corporation started a construction job with a contract price of $5.46 million. Indigo ran into severe technical difficulties during construction but managed to complete the job in 2022. The contract is non-cancellable. Under the terms of the contract, Indigo sends billings as revenues are earned. Billings are non-refundable. The following information is available:
Cost Incurred to Date:
2020: 780,000
2021: 2730,000
2022: 5360,000
Estimated costs to complete:
2020: 4095,000
2022: 0 (Zero)
REQUIRED - Calculate the amount of gross profit that should be recognized each year under the percentage-of-completion method.
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