Sunfish Construction Company uses the percentage-of-completion method of accounting. In 2014, Sunfish began work on a project which had a contract price of $1,600,000 and estimated costs of $1,200,000 . Additional information is as follows: 2014 2015 Costs incurred during the year ............ $240,000 $1,060,000 Estimated costs to complete, as of 12/31/14 ................................ 960,000
Billings during the year .................. 290,000 1,310,000 Collections during the year ............... 250,000 1,200,000 The amount of gross profit Sunfish should recognize on this contract during 2014 is
a. $40,000.
b. $80,000.
c. $100,000.
d. $200,000.
B
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