26．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:

Select exactly 1 answers from the following: A. B. C. D.
答案和详解如下！
Feedback: Correct answer: C

The Analysis and Use of Financial Statements, 3rd edition, Gerald I. White, Ashwinpaul C. Sondhi, and Dov Fried (Wiley, 2003), pp. 40-44

2006 Modular Level I, Vol. II, pp. 520-524

Study Session 7-31-c

identify the appropriate income statement and balance sheet entries using the percentage-of-completion method and the completed contract method and describe and calculate the effects on cash flows and selected financial ratios that result from using the percentage-of-completion method versus the completed contract method

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.

谢谢

b

c

3

c

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