Which of the Following Is Not True About Accounting for Long-Term

question 237

Multiple Choice

Which of the following is not true about accounting for long-term construction contracts?

• A) Long-term construction contracts could show a contract asset or contract liability, depending on the relation between construction in progress and billings.
• B) Billings on contracts in progress is a contra account to accounts receivable.
• C) Gross profit is debited to construction in progress.
• D) When a customer is billed for payment due, billings on contracts in progress is credited at the same time accounts receivable is debited.

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