Jamestown Inc. enters into a $300,000 contract for the purchase of customized equipment with Bennington Inc. The construction of the equipment is expected to take two years. Jamestown Inc. owns the work in process during the two-year period but will not take possession of the equipment until completed. The contractor will bill Jamestown monthly for performance completed to date. After year-one, Bennington Inc. incurred costs of $120,000 and expects remaining costs to be $108,000. Bennington Inc. has billed Jamestown $150,000 in total for the year. Jamestown has paid $135,000 to Bennington Inc. Determine the amount of revenue and expenses that Bennington Inc. should recognize in the first year of the contract.
