Imagine That the Ace Construction Company (ACC) Is Going to Switch

question 3

Essay

Imagine that the Ace Construction Company (ACC) is going to switch from the percentage of completion method to the completed contract method. Assume that none of their construction projects are going to produce a loss. Is it possible that, in a particular year, ACC will show higher gross profit under the completed contract method than they would under the percentage-of-completion method? Explain.

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