Gleason Construction enters into a long-term fixed price contract to build an office building for $20,000,000. In the first year of the contract Gleason incurs $6,000,000 of cost and the engineers determined that the remaining costs to complete are $15,000,000. How much gross profit or loss should Gleason recognize in Year 1 assuming the use of the percentage-of ­completion method?

A) $1,000,000 profit

B) $1,000,000 loss

C) $0

D) $285,714 loss

Answer rating: 100% (QA)

A 0 Under the completed contract method because of ... View the full answer