The Percentage-Of-Completion Method and the Proportional Performance Method Are Methods

question 12

True/False

The percentage-of-completion method and the proportional performance method are methods that recognize revenue at a point in the earnings process completed.

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Definitions:

TFC

stands for Total Fixed Costs, which are the costs that do not vary with the level of production or sales, such as rent or salaries.

Average Fixed Cost

The fixed costs of production divided by the quantity of output produced, showing the cost of each unit's share of the fixed expenses.

Average Variable Cost

Average variable cost is the total variable cost divided by the quantity of output produced, indicating the variable cost incurred per unit of output.

Total Cost

The sum of all costs incurred by a business in producing a given level of output, including fixed and variable costs.