If a Company Uses the Completed Contract Method Rather Than

question 152

Multiple Choice

If a company uses the completed contract method rather than the percentage of completion method,the total profit the company recognizes from the beginning of the project throughout its completion will be which of the following?

• A)greater if the completed contract method is used.
• B)greater if the percentage of-completion method is used.
• C)the same for both methods.
• D)greater for the completed-contract method only if the project takes longer than five years to complete.

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Definitions:

UCC

The Uniform Commercial Code, a comprehensive set of laws governing all commercial transactions in the United States, including sales, negotiable instruments, and secured transactions.

Implied Warranty

A legal assumption that a product is fit for its intended purpose, even if not expressly stated by the seller.

Merchantability

A guarantee that a product will meet reasonable quality and performance standards for sale to customers.

Merchantable

A legal term referring to goods that meet basic quality standards and are fit for the purpose for which goods of that kind are usually purchased.