Sailor Construction Company has consistently used the percentage-of- completion method. On January 10, 2014, Sailor began work on a $3,000,000 construction contract. At the inception date, the estimated cost of construction was $2,250,000 . The following data relate to the progress of the contract: Gross profit recognized at December 31 . 2014 .......... $ 300,000 Costs incurred Jan. 10, 2011,
through Dec. 31 . 2015 ... 1,800,000 Estimated cost to complete at December 31 . 2015 ....... 600,000 How much gross profit should Sailor recognize for the year ended December 31 . 2015?
a. $150,000
b. $262,500
c. $300,000
d. $450,000
A
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