Use the Following Information for Questions

question 50

Multiple Choice

Use the following information for questions.
Gorman Construction Co.began operations in 2012.Construction activity for 2012 is shown below.Gorman uses the cost-recovery method.

-Which of the following should be shown on the statement of financial position at December 31, 2012 related to Contract 2?

• A)Inventory, $680,000
• B)Inventory, $820,000
• C)Current liability, $680,000
• D)Current liability, $1,500,000

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Definitions:

Confidence Interval

A range of values derived from sample data that is believed to contain the true population parameter with a certain level of confidence.

P-value

A statistical measure that helps in determining the significance of the results from a test, indicating the probability of observing results at least as extreme as those seen, under the assumption that the null hypothesis is true.

Chi-square Distribution

The Chi-square distribution is a probability distribution used in statistical significance tests, particularly suitable for categorical data.

Normal Distribution

A bell-shaped distribution that is symmetric about the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.