Under ASPE, When Selecting an Accounting Method for a Newly

question 114

Multiple Choice

Under ASPE, when selecting an accounting method for a newly contracted long-term construction project, the principal factor to be considered should be

• A) the terms of payment in the contract.
• B) the degree to which a reliable estimate of the costs to complete and extent of progress toward completion can be made.
• C) the method commonly used by the contractor to account for other long-term construction contracts.
• D) the inherent nature of the contractor's technical facilities used in construction.

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Definitions:

Future Value

The value of an investment or asset at a specified date in the future, taking into account factors such as interest rates or earnings.

Ordinary Annuity

A sequence of identical payments that are distributed at consistent intervals, where the initial payment is made at the conclusion of the period.

RRSP

Registered Retirement Savings Plan, a retirement savings and investment account for holding savings and investment assets, recognized by the Canadian government.

Month-end Contributions

Payments or deposits made towards an investment or savings plan at the end of each month.