The Completed-Contract Method of Accounting for Long-Term Construction-Type Contracts Is

question 46

Multiple Choice

The completed-contract method of accounting for long-term construction-type contracts is preferable when

• A) a contractor is involved in numerous projects.
• B) the contracts are of a relatively long duration.
• C) estimates of costs to complete and extent of progress toward completion are reasonably dependable.
• D) there are inherent uncertainties in the contract beyond normal business risks.

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Definitions:

Uncertainties

Situations or outcomes that are unpredictable or unknown.

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