Yang Construction Company Entered into a Contract to Build a New

question 38

Multiple Choice

Yang Construction Company entered into a contract to build a new airport terminal for $2,500,000. Construction commenced on August 1, 2011, with a planned completion date of December 31, 2013. A summary of the costs, billings, and collections is provided below: Yang uses the percentage of completion method. How much gross profit would Yang recognize in 2012?

• A)$100,000 loss
• B)$75,000 loss
• C)$50,000 profit
• D)$100,000 profit

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Definitions:

Patented Technology

Innovations or inventions that are legally protected by patents, preventing unauthorized use, replication, or sale.

Timely New Products

The strategic introduction of new products to the market at the most opportune moment to meet consumer demand and stay competitively relevant.

Environmental Uncertainty

Refers to the degree of unpredictability and complexity in an organization’s external environment, affecting its decision-making processes.

Complexity

The state of being intricate or complicated.