Determine the amount of gross profit to be recognized

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Reference no: EM133370209

Question: Build a Bridge Inc. prepares its financial statements in accordance with IFRS. The company started work on a contract in May 2023 to build a small bridge at a fixed price of $10 million. The bridge was to be completed by September 2025 at a total estimated cost of $8 million. Total cumulative costs incurred by the end of December 2023 and 2024 were $2 million and $5.5 million, respectively. Because of cost overruns in 2024, it is now expected that the project will cost $800,000 more than originally estimated. Final costs at the end of the project totalled $9 million.Determine the amount of gross profit to be recognized for the years ending December 31, 2023 and 2024.

Reference no: EM133370209

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