Firms have free choice as to whether they use the percentage-of-completion method or the completed contract method to account for a long-term contract.

Question

Quizplus · Accepted Answer

Firms must follow specific accounting standards and guidelines, such as those set by the Financial Accounting Standards Board (FASB), which dictate when each method can be used based on the nature of the contract and the certainty of the project's outcome.

Firms Have Free Choice as to Whether They Use the Percentage-Of-Completion