In 2018, Cupid Construction Co. (CCC) began work on a two-year fixed price contract project. CCC recognizes revenue over time according to percentage of completion for this contract, and provides the following information (dollars in millions):
-What is the amount of gross profit on the project recognized by CCC during 2018?
A) $160 million.
B) $72 million.
C) $48 million.
D) Cannot be determined from the given information.

Question

In 2018, Cupid Construction Co. (CCC) began work on a two-year fixed price contract project. CCC recognizes revenue over time according to percentage of completion for this contract, and provides the following information (dollars in millions):  
-What is the amount of gross profit on the project recognized by CCC during 2018?
A) $160 million. 
B) $72 million. 
C) $48 million. 
D) Cannot be determined from the given information.

Quizplus · Accepted Answer

Construction in progress = Actual costs incurred + Gross profit recognized; so $207 million = $135 million + X. Solve for X. X = $72 million.