Johann Builders Has a Fixed -Price Contract Providing $120,000 of Revenue.Construction

question 44

Multiple Choice

Johann Builders has a fixed -price contract providing $120,000 of revenue.Construction on the contract was begun in 2013 and was completed in 2014.Information relating to the contract is as follows: What amount of income should Johann recognize in 2014 assuming that the company appropriately uses the percentage-of-completion method of income recognition?

• A) $9,286
• B) $15,000
• C) $17,000
• D) $7,000

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Definitions:

Petty Cash Account

A small amount of cash kept on hand for minor or incidental expenses, managed through a specified fund.

Purpose

The reason for which something is done or created or for which something exists.

General Journal Entry

A general journal entry is a record of financial transactions that includes details such as date, accounts impacted, amounts, and a brief description of the transaction.

Petty Cash Fund

A petty cash fund is a small amount of cash on hand used for paying expenses too small to merit writing a check or using a credit card.