Jenny Thompson Construction Company has entered into a contract beginning January 1, 2007, 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 $900,000. The following data pertain to the construction period.

Instructions
(a) Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period.
(b) Using the completed-contract method, compute the estimated gross profit that would be recognized during each year of the constructionperiod.

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2007 2008 2009 $270,000 $420,0000 $000,000 Costs to date Estimated costs to complete Progress billings to date Cash collected to date $600,000 330,000 270,000 240,000 180,000 550,000 500,000 900,000 900,000