On March 15, 2014, Frankel Construction contracted to build a shopping center at a contract price of \(\$ 125\) million. The schedule of expected (which equals actual) cash collections and contract costs follows:

a. Calculate the amount of revenue, expense, and net income for each of the three years 2014 through 2016 using the percentage-of-completion revenue recognition method. (Round percents to the nearest whole number.)

b. Discuss whether or not the percentage-of-completion method provides a good measure of this construction company's performance under the contract.

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Year 2014 Cash Collections $ 30 million 50 million 45 million 2015..... 2016..... Total..... $125 million Cost Incurred $ 20 million 45 million 35 million $100 million