Exercise 5-18 Long-term contract; revenue recognition over time vs. upon project completion [LO5-9] On June 15, 2018, Sanderson Construction entered into a long-term construction contract to build a baseball stadium in Washington D.., for $270 million. The expected completion date is April 1, 2020, just in time for the 2020 baseball season. Costs incurred and estimated costs to complete at year-end for the life of the contract are as follows ($ in millions): 2018 2019 2020 $ 50 $100 60 Costs incurred during the vear Estimated costs to complete as of December 31 150 90 Required 1. Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming Sanderson recognizes revenue over time according to percentage of completion. 2. Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming this project does not qualify for revenue recognition over time. 3. Suppose the estimated costs to complete at the end of 2019 are $100 million instead of $90 million. Compute the amount of revenue and gross profit or loss to be recognized in 2019 using the percentage of completion method. Complete this question by entering your answers in the tabs below Required 1Required 2 Required 3 Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming Sanderson recognizes revenue over time according to percentage of completion. (Enter your answers in millions. Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the table below to arrive at your final answer.) Show lessA Percentages of completion | Choose numerator Actual costs to date | Choose denominator Estimated total costs 1-1 % complete to date + 2018 2019 2020 100.00% 2018 to arrive at your final answer.) Show lessA Percentages of completion | Choose numerator Actual costs to date | Choose denominator Estimated total costs 1-1 % complete to date + 2018 2019 2020 100.00% 2018 To date Recognized in prior years Recognized in 2018 Construction revenue Gross profit (loss) 2019 To date Recognized in prior years Recognized in 2019 Construction revenue Gross profit (loss) 2020 To date Recognized in prior years Recognized in 2020 Construction revenue Gross profit (loss) 1. Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming Sanderson recognizes revenue over time according to percentage of completion. 2. Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming this project does not qualify for revenue recognition over time. 3. Suppose the estimated costs to complete at the end of 2019 are $100 million instead of $90 million. Compute the amount of revenue and gross profit or loss to be recognized in 2019 using the percentage of completion method. Complete this question by entering your answers in the tabs below Required 1Required 2Required 3 Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming this project does not qualify for revenue recognition over time. (Enter your answers in millions. Loss amounts should be indicated with a minus sign.) 2018ecognizedGross 2019 2020 Profit (Loss) recognized Year million million million million million Required 1 Required 3> Required: 1. Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming Sanderson recognizes revenue over time according to percentage of completion. 2. Compute the revenue and gross profit will Sanderson report in its 2018, 2019, and 2020 income statements related to this contract assuming this project does not qualify for revenue recognition over time. 3. Suppose the estimated costs to complete at the end of 2019 are $100 million instead of $90 million. Compute the amount of revenue and gross profit or loss to be recognized in 2019 using the percentage of completion method. Complete this question by entering your answers in the tabs below. Required 1Required 2Required 3 Suppose the estimated costs to complete at the end of 2019 are $100 million instead of $90 million. Compute the amount of revenue and gross profit or loss to be recognized in 2019 using the percentage of completion method. (Enter your answers in millions. Use percentages as calculated and rounded in the table below to arrive at your final answer.) Percentages of completion Choose numerator | | Choose denominator-| % complete to date 2019 2019 Recognized in prior Years Recognized in 2019 To date Construction revenue Construction expense Gross profit (loss) Required 2 Required 3