30、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.

Compared to the completed contract method of revenue recognition, will the percentage-of-completion method most likely result in higher:

A. Answer A

B. Answer B

C. Answer C

D. Answer D

[此贴子已经被作者于2008-11-7 13:21:49编辑过]

30、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.

Compared to the completed contract method of revenue recognition, will the percentage-of-completion method most likely result in higher:

A. Answer A

B. Answer B

C. Answer C

D. Answer D

Correct answer = C

"Understanding the Income Statement," Thomas R. Robinson, Hennie van Greuning, Elaine Henry, and Michael A. Broihahn
2008 Modular Level I, Vol. 3, pp. 148-151
Study Session 8-32-b
explain the general principles of revenue recognition and accrual accounting, demonstrate specific revenue recognition applications (including accounting for long-term contracts, installment sales, barter transactions, and gross and net reporting of revenue), and discuss the implications of revenue recognition principles for financial analysis
Compared to the completed-contract method, the percentage-of-completion method will most likely result in higher total assets, reflecting the accrual of gross profit during the contract period and lower liabilities, as the higher level of construction-in-progress provides a larger offset to advance billings. 

d