In Year 1,a Contractor Agrees to Build a Building for $2,500,000

question 46

Multiple Choice

In Year 1,a contractor agrees to build a building for $2,500,000 by the end of year 2.The builder's cost is estimated to be $1,800,000.The actual costs in Year 1 are $900,000 and Year 2's actual costs are $1,300,000.Under the completed contract method,the gross profit for Year 1 is

• A)$0.
• B)$300,000.
• C)$350,000.
• D)$700,000.