Which of the Following Statements Regarding the Percentage-Of-Completion and Completed

question 111

Multiple Choice

Which of the following statements regarding the percentage-of-completion and completed contract methods of accounting for long-term construction contracts are true?

• A) They recognize different amounts of income for the construction period.
• B) They produce the same inventory carrying values during the construction period.
• C) Neither requires losses to be recognized in the period of occurrence.
• D) Under only the percentage of completion method is it possible to recognize a loss for the period when an overall profit is expected on the contract.

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