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Question - Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,810,000. The project was begun in 2020 and completed in 2021. Cost and other data are presented below:
2020
2021
Costs incurred during the year
$447,000
$1,110,000
Estimated costs to complete
1,043,000
0
Billings during the year
405,000
1,405,000
Cash collections during the year
305,000
1,505,000
Assume that Beavis recognizes revenue on this contract over time according to percentage of completion.
Required - Compute the amount of gross profit recognized during 2020 and 2021.
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