13. Frame construction company’s contract requires the construction of a bridge in three years. The expected total cost of the bridge is $2,000,000, and Frame will receive

$2,500,000 for the project. The actual costs incurred to complete the project were $500,000, $900,000, and

$600,000, respectively, during each of the three years.

Progress payments received by Frame were $600,000,

$1,200,000, and $700,000, respectively. Assuming that the percentage-of-completion method is used, what amount of gross profit would Frame report during the last year of the project?

a. $120,000

b. $125,000

c. $140,000

d. $150,000