When accounting for revenue over time for a long-term contract, the percentage of completion used to recognize revenue in the first year usually is determined by measuring:
Costs incurred in the first year, divided by estimated remaining costs to complete the project.
b. Costs incurred in the first year, divided by estimated total costs for the completed project.
c. Costs incurred in the first year, divided by estimated gross profit.
d. Costs incurred in the first year, divided by estimated total costs to be incurred in the remaining years of the project.