The percentage-of-completion method does not
A)recognize profit each period during the life of the contract in proportion to the portion of the contract completed during the period
B)value the inventory at cost less any partial billings
C)give precedence to economic substance over legal form
D)value the inventory at the costs incurred plus the profit recognized to date less any partial billings

Question

Quizplus · Accepted Answer

The percentage-of-completion method values inventory at cost less any partial billings, but it does recognize profit each period during the life of the contract in proportion to the portion of the contract completed during the period. It also gives precedence to economic substance over legal form and values inventory at costs incurred plus profit recognized to date minus any partial billings.

The Percentage-Of-Completion Method Does Not