If a Company Uses the Completed-Contract Method of Accounting for Long-Term

question 40

Multiple Choice

If a company uses the completed-contract method of accounting for long-term construction contracts,then during the period of construction,financial information related to a long-term contract will

• A) appear on both the income statement and balance sheet during the construction period.
• B) appear only on the income statement during the period of construction.
• C) appear only on the balance sheet during the period of construction.
• D) not appear on the financial statements.

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Definitions:

International Sale of Goods

Transactions involving the sale of goods between parties located in different countries, governed by conventions and international agreements like the CISG.

Commercial Sale

The act of selling goods or services within a commercial context, often involving bulk transactions between businesses.

Licensing Subsidiary

A business entity created for the purpose of holding licenses or intellectual property rights and possibly leasing these rights to affiliate companies or third parties.

Own Business

The act of managing and operating an individual’s personal entrepreneurial venture or company.