Fields Construction Decides to Change from the Completed-Contract Method to the Percentage-Of-Completion

question 31

Essay

Fields Construction decides to change from the completed-contract method to the percentage-of-completion method of recording construction projects. It also has a compensation plan for bonuses to supervisors for three percent of net income, which are retroactive for changes in prior years' net income. Discuss the direct and indirect effects of this change.

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Definitions:

Real Solutions

The set of solutions of an equation that are real numbers, as opposed to imaginary or complex numbers.

Complex Solutions

Solutions to equations that have both a real component and an imaginary component.

Completing The Square

A method used to solve quadratic equations by converting the equation into a perfect square trinomial.

Quadratic Equation

A quadratic equation is represented as ax^2 + bx + c = 0, with a, b, and c being constant values and a not equal to zero.