Nichols Construction Company (NCC)entered into a Contract to Build a Shopping

question 91

Multiple Choice

Nichols Construction Company (NCC) entered into a contract to build a shopping complex for $1,900,000. Construction commenced on July 1, 2011, with a planned completion date of December 31, 2013. A summary of the related accounting information is provided below: How much would the balance in accounts receivable be on the balance sheet of NCC at the end of 2013 if NCC uses the percentage of completion method?

• A)$0
• B)$250,000
• C)$290,000
• D)$800,000

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Definitions:

Title Passes

The point at which ownership of property is transferred from one party to another, typically upon the fulfillment of specified conditions.

Seller Completes Performance

The point at which a seller has fulfilled their contractual obligations in a transaction, typically resulting in the transfer of goods or services to the buyer.

Security Interests

Legal claims on assets that are used as collateral to secure loans or other obligations.

Personal Property

Movable property that is not fixed to one location and can be tangible, like cars and furniture, or intangible, such as stocks and bonds.