Which of the following is NOT a difference between the percentage-of completion and completed-contract methods of accounting for long-term construction contracts?
A) They report different amounts for inventory during the construction period.
B) They report different amounts for progress billings during the construction period.
C) They cause a different cash inflow during the construction period.
D) They report different amounts for accounts receivable during the construction period.

Question

Quizplus · Accepted Answer

The percentage-of completion and completed-contract methods of accounting for long-term construction contracts differ in how they report inventory, progress billings, and accounts receivable during the construction period. However, neither method affects the cash inflow during the construction period as cash is typically received based on progress billings rather than the selected accounting method.

Which of the Following Is NOT a Difference Between the Percentage-Of