How to add Gradle backing to existing project?

In the process of trying to get my project running on Gradle I have installed and setup Gradle for my new project.

My problem is that I keep getting an error "Module X is not backed by Gradle". I've run gradle setupBuild and the files seem correct, but when running in Android Studio it won't stop the error.

Here's a screenshot of what I'm getting:

So I'm wondering how to add Gradle backing to the project within Android Studio if the project is already in there.

I have yet to find a good solution within Android Studio, but this has worked for me on several projects:

1. Close the project in Android Studio (so it doesn't open the project automatically in later steps) and then close Android Studio
2. Clean the project (delete the ".idea" and "build" folders, .iml files, etc.) so you only have the source files remaining
3. Set up gradle by adding the appropriate settings.gradle and build.gradle files (test your setup using the command line)
4. Open Android Studio and choose "Import project" and choose to use Gradle as the external model
5. Pick your settings.gradle file as the Gradle project
6. [Optional] Set your "Gradle home" folder (so the text turns black instead of gray). Earlier versions of Android Studio caused problems for me if I didn't do this. Make sure you use Gradle 0.1.10 or newer (earlier versions do not work with the current Gradle build tools).

Also, remember to use the latest version of the Gradle build tools. If you want, you can setup Gradle to use the most recent version like this:

buildscript {
    repositories {
        mavenCentral()
    }
    dependencies {
        classpath 'com.android.tools.build:gradle:1.1.0'
    }
}

Importing Eclipse Projects

Simpler Solution nowadays

All you need to do is "Import Project" in android studio to import eclipse projects. After that, try to "Syncronize project" and if it fails, and pops up that error u had, it should also be accompanied with an entry in "Entry log" as to what is the problem, "Cause: failed to find target android-10" for me. Once you fix that you should be able to successfully sync project and keep on going.