IFRS and GAAP Will Sometimes Differ in the Method of Revenue

question 18

Multiple Choice

IFRS and GAAP will sometimes differ in the method of revenue recognition applied to construction contracts.Three different methods are involved: percentage of completion, cost recovery, and completed contract.The fastest to slowest revenue recognition among the methods is

• A)percentage of completion; completed contract; cost recovery
• B)completed contract; percentage of completion; cost recovery
• C)percentage of completion; cost recovery; completed contract
• D)cost recovery; percentage of completion; completed contract

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Definitions:

External Attributions

The process of explaining someone's behavior by referring to situational or environmental factors.

Self-Serving Bias

A common cognitive bias that causes individuals to attribute success to personal factors and failures to external factors.

External Attributions

The process of attributing the cause of one's own or another's behavior to external factors or the environment.

New Task

A previously unencountered or novel assignment or activity that requires completion.