Luke's Construction Receives a Contract to Build a Bridge for $6

Multiple Choice

Luke's Construction receives a contract to build a bridge for $6 000 000, with an estimated cost of $4 000 000. Over the three- year construction period, the costs are estimated to be $500 000 in Year 1, $3 200 000 in Year 2 and $300 000 in Year 3. How much construction revenue would be reported in Year 2 using the percentage of completion method?

A) $4 800 000
B) $3 200 000
C) $2 800 000
D) $2 300 000