When It Is Probable That Total Contract Costs Will Exceed

question 46

True/False

When it is probable that total contract costs will exceed total contract revenue,the expected loss should not be recognised as an expense until the future economic sacrifice eventuates.

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Definitions:

Production Function

A mathematical representation showing the relationship between input factors of production and the output of goods or services.

Lowest Cost

The minimal expense incurred in the production or procurement of goods or services, under efficient conditions.

Output

The quantity of goods or services produced within a given time period.

Factor Prices

The costs of the inputs that are used in the production of goods or services.