Arizona Desert Homes (ADH) Constructed a New Subdivision During 2017

question 302

Multiple Choice

Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below:
-ADH recognizes revenue upon completion of the contract. In its December 31, 2017, balance sheet, ADH would report:

• A) The contract asset, cost and profits in excess of billings, of $500,000.
• B) The contract liability, billings in excess of cost, of $300,000.
• C) The contract asset, contract amount in excess of billings, of $1,500,000.
• D) The contract asset, deferred profit, of $400,000.

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Definitions:

Federal Civil Rights Commission

An independent, bipartisan agency established by the U.S. government responsible for investigating, reporting on, and making recommendations concerning civil rights issues in the United States.

Jackie Robinson

Broke the color barrier in Major League Baseball in 1947, becoming the first African American to play in MLB in the modern era.

Color Barrier

The practice of excluding individuals based on race or ethnicity, particularly evident in segregation and discriminatory policies.

Real Income

The income of an individual or group after adjusting for inflation, reflecting the actual purchasing power over time.