Answer: $(150,000)
Explanation:
Under the Revenue upon Contract Completion method revenue for 2021 is calculated as follows.
The total cost for 2021 will be the cost incurred that year plus that of the previous year which would be,
= 250,000 + 1,600,000
= $1,850,000
We will then add the estimated cost left to find out the total ESTIMATED cost as at 2021,
= 1,850,000 + 500,000
= $2,350,000 is the total estimated cost.
Total Income therefore will be,
= Revenue - Total Estimated Cost
= 2,200,000 - 2,350,000
= -$150,000
JRE2 would report gross LOSS of $150,000 in 2021
