Question: On June 15, 2016, Sanderson Construction entered i…
On June 15, 2016, Sanderson Construction entered into a long-term construction contract to build a baseball stadium in Washington, D.C., for $390 million. The expected completion date is April 1, 2018, just in time for the 2018 baseball season. Costs incurred and estimated costs to complete at year-end for the life of the contract are as follows ($ in millions):
Costs incurred during the year $60 $130 $70
Estimated costs to complete as of December 31 190 60 —
Determine the amount of revenue, cost, and gross profit or loss to be recognized in each of the three years under IFRS, assuming that using the percentage-of-completion method is not appropriate. (Enter your answers in millions.)
2016 2017 2018
Revenue ? ? ?
Cost 60 130 70
Gross Profit (loss) to be recognized ? ? ?