(2 of 2) Desert Design & Construction received a contract to build a subdivision of homes for $28 million. The total cost to build can be reasonably estimated at $11 million over five years, thus the firm uses the percentage of completion method. Below is a schedule of the costs incurred. Costs incurred year 1: $3,000,000 Costs incurred year 2: $2,500,000 Costs incurred year 3: $2,000,000 Costs incurred year 4: $1,500,000 Costs incurred year 5: $2,000,000 How much profit should the firm book in year 4?
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