Exercise 6-20 (Algo) Long-term contract; revenue recognition over time vs. upon project completion [LO6-9] On June 15, 2024, Sanderson Construction entered into a long-term construction contract to build a baseball stadium in Washington, D.C., for $320 million. The expected completion date is April 1, 2026, just in time for the 2026 baseball season. Costs incurred and estimated costs to complete at year-end for the life of the contract are as follows ($ in millions): Costs incurred during the year Estimated costs to complete as of December 31 Required: Required 1 Required 2 Required 3 2024 2025 2026 Construction revenue Construction expense Gross profit (loss) 1. Compute the revenue and gross profit that Sanderson will report in its 2024, 2025, and 2026 income statements related to this contract, assuming Sanderson recognizes revenue over time according to percentage of completion. 2. Compute the revenue and gross profit that Sanderson will report in its 2024, 2025, and 2026 income statements related to this contract, assuming this project does not qualify for revenue recognition over time. 3. Suppose the estimated costs to complete at the end of 2025 are $120 million instead of $70 million. Compute the amount of revenue and gross profit or loss to be recognized in 2025, assuming Sanderson recognizes revenue over time according to percentage of completion. Complete this question by entering your answers in the tabs below. Construction revenue Construction expense Gross profit (loss) Construction revenue Construction expense Gross profit (loss) $ $ $ 2024 Compute the revenue and gross profit that Sanderson will report in its 2024, 2025, and 2026 income statements related to this contract, assuming Sanderson recognizes revenue over time according to percentage of completion. Note: Enter your answer in millions (i.e., $4,000,000 should be entered as $4). Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the table below to arrive at your final answer. To date To date $ 60 180 To date 2025 $ $ $ $ 120 70 Percentages of completion 60 + $ 180 + $ 230 ÷ $ 2024 2026 2025 $ 50 2026 Recognized in prior years Recognized in prior years Recognized in prior years 240 = 250 230 0 0 0 $ $ $ $ $ $ $ $ $ 25.00% 72.00% 100.00% Recognized in 2024 Recognized in 2025 Recognized in 2026 0 0 0 0 0 0 0 0 0 Show less