Question: McNeil Construction Company is involved in a long-term construction contract to build an office building. The estimated cost is $30 million and the contract price is $38 million. Other information follows:
Office Building
Cash Collection Actual Costs Incurred
2004 $ 6,000,000 $ 4,500,000
2005 $ 8,000,000 $ 6,000,000
2006 $ 12,500,000 $ 12,000,000
2007 $ 11,500,000 $ 7,500.000
The projected is completed in 2007 and all cash to be received from eh contract has been received.
How would a schedule look if you were determining the gross profit in each year for the long term construction contracting using the percentage of completion method?