At the beginning of 2006, Florida Road Construction entered into a contract to build a road for the government. Construction will take four years. The following information as of 31 December 2006 is available for the contract:
|
Total revenue according to contract |
$10,000,000 |
|
Total expected cost |
$8,000,000 |
|
Cost incurred during 2006 |
$1,200,000 |
Under the completed contract method, how much revenue will be reported in 2006?
a. None
b. $300,000
c. $1,500,000