Which Formula Explains How Gross Profit Is Recognized When an Overall

question 49

Multiple Choice

Which formula explains how gross profit is recognized when an overall loss is expected on the contract under the percentage completion method?

• A)Cost incurred / Estimated total cost.
• B)(Cost incurred / Estimated total cost)× Contract revenue - Revenue previously recognized.
• C)(Cost incurred / Estimated total cost)× Estimated total cost - Cost of sales previously recognized.
• D)100% × (Estimated gross loss)- (Gross profit/loss previously recognized).

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Definitions:

Batteries

Electrochemical cells that store energy and release it in the form of electricity, used as a power source in many electronic devices and vehicles.

SAE Relay

A relay standardized by the Society of Automotive Engineers, designed for automotive electrical applications.

Control Circuit

Used in reference to both cranking systems and air brake systems. In a cranking system, it is the low-current switching circuit that connects the ignition switch with the magnetic switch. In an air brake system, it defines low-volume pilot air signals that are used to activate high-volume slave circuits.

Terminals

Terminals refer to the points at which electrical connections are made to a circuit, device, or a battery, facilitating the transfer of electrical power or signals.