kd26gioi

Dear Thu Thuy,

The loss is recognised immediately when u estimate that the cost of completing the remaining contract will be more than the earlier estimate and ur remaining revenues will not be able to absorb the cost.

In completed contract method, full revenue is recognised at completion of the contract. but if during the completion stage, the estimate to complete the contract revised upward and that cost is more than the revenues of the contract the excess amount is recognised as a loss immediately.

Hope this will clarify.