Question

Constructing and Assessing Income Statements Using Cost-to-Cost Method
Assume GE Hitachi Nuclear Energy agreed in May 2019 to construct a nuclear generator for NSTAR, a utility company serving the Boston area. GE Hitachi estimated that its construction costs would be $600 million. The contract price of $750 million is to be paid as follows: $250 million at the time of signing; $250 million on December 31, 2019; and $250 million at completion in May 2020. GE Hitachi Nuclear Energy incurred the following costs in constructing the generator: $240 million in 2019 and $360 million in 2020.

a. Compute the amount of GE Hitachi's revenue, expense, and income for both 2019 and 2020, and for both years combined, under the cost-to-cost revenue recognition method.
Enter dollar amounts in millions.

Cost-to-Cost Method
Year	Cost   Incurred	% of total   expected costs	Revenue Recognition	Income
2019	$ Answer	Answer %	$ Answer	$ Answer
2020	Answer	Answer %	Answer	Answer
Total	$ Answer		$ Answer	$ Answer

Answer 1