Remington Construction Company uses the percentage-of-completion method.During 2010, the company entered into a fixed-price contract to construct a building for Sherman Company for $30,000,000.The following details pertain to the contract:
The amount of construction costs incurred during 2011 was

Question

Quizplus · Accepted Answer

The percentage of completion method requires the reporting of construction costs incurred as a percentage of total estimated costs. Based on the information given, we cannot determine the estimates of total costs, so we cannot compute the percentage of completion. However, we do know that $9,375,000 was incurred in 2011, so option B is correct.

Remington Construction Company Uses the Percentage-Of-Completion Method