The completed contract method for accounting for long-term construction projects requires that
A)no revenue is recognized until the project is completed.
B)costs are accumulated and revenue is recognized in proportion to cash collected.
C)gross profit is calculated each period, but deferred until the end of the contract.
Revenue Recognition 6 - 13
D)revenue is calculated each period, but deferred until the end of the contract.

Question

Quizplus · Accepted Answer

The completed contract method recognizes revenue and gross profit only when the contract is completed, not during the construction process.

The Completed Contract Method for Accounting for Long-Term Construction Projects