Pharoah Construction Company has entered into a contract beginning January $1,2025,$ to build a parking complex. It has been estimated that the complex will cost $$600,000$ and will take $3$ years to construct. The complex will be billed to the purchasing company at $$901,000.$ The following data pertain to the construction period.

$2025$

$2026$

$2027$

Costs to date

$$246,000$ $$432,000$ $$612,000$

Estimated costs to complete

$354,000168,0000$

Progress billings to date

$270,000546,000901,000$

Cash collected to date

$240,000496,000$ Using the cost$-$recovery method, compute the estimated gross profit that would be recognized during each year of the construction period. $($If answer is $0,$ please enter $0.$ Do not leave any fields blank.$)$

Gross profit recognized in $2025$

$enter a dollar amount

$0$

Correct answer

Gross profit recognized in $2026$

$enter a dollar amount $114000$

Incorrect answer

Gross profit recognized in $2027$

$enter a dollar amount $355000$

incorrect answer

Answer rating: 100% (QA)

To calculate the estimated gross profit recognized during each year using the costrecovery method we ... View the full answer