Pennfield Construction Corp. began work on a $5,020,000 construction contract in 2014. During 2014, the company incurred costs of $1,600,000, billed its customer for $ 1,750,000, and collected $1,500,000. At December 31, 2014, the estimated future costs to complete the project total $2,500,000. Assume that Pennfield uses the percentage of-completion method. Prepare all journal entries required for the year ended December 31, 2014, under the earnings approach.
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