Kirby Builders, Inc. is using the completed-contract method for a $5,600,000 contract that will take two years to complete. Data at December 31, 2010, the end of the first year, are as follows:

cost inccured to date : 2,560,000

estimate cost to complete 3,280,000

billing to date 2,400,000

collection to date 2,000,0000

The gross profit or loss that should be recognized for 2010 is $0. a $240,000 loss. a $120,000 loss. a $105,600 loss.

a) 0

b) 240,000 loss

c) 120,000 loss

d) 105, 600 loss