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In 2013,Modern Construction Company Entered into a Contract to Construct

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In 2013,Modern Construction Company entered into a contract to construct a building for $5,000,000.The estimated cost to complete the building is $4,000,000 and the project will be completed in 2014.Modern incurred actual construction costs of $1,600,000 and $1,800,000 in 2013 and 2014,respectively.How much gross profit is recognized using the percentage-of-completion method in 2013 and 2014?


Definitions:

End of Budget Period

The conclusion of a specified time frame for which a budget was prepared, marking an opportunity to review budgetary performance against actual financial activity.

Sales Budget

A forecast of a company's sales revenue for a specific period of time.

Prepared First

A term that is not specifically defined in business or finance, potentially referring to procedures or documents that must be prioritized or completed initially in a process.

Budget Process

The process by which an organization or individual creates and manages a plan for its financial resources and expenditures.

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