When outcome of a construction contract is estimated reliably, contract revenue and contract costs associated with the construction contract should be recognized using *   A. cost recovery method B. percentage of completion method C.gross profit method D.zero profit method.

Q: A method of reporting income that is used when collection can be made over a relatively long periods…

A: Income refers to the revenue which is earned through business from selling the goods and services.

Q: The primary issue in the accounting for construction contracts is   the determination of the…

A: Construction contract:     It is the contract between the parties that include all details of…

Q: In any construction project, the total bill to the owner must equal a. Gross profit b. Net profit c.…

A: The construction contract accounting is the accounting system suitable for businesses engaged in…

Q: Percentage of Completion is favored to be used under the following circumstances, except:   a.…

A: The percentage of completion method reports revenues and expenses in terms of the work completed to…

Q: Which one of the following accounts is an asset similar to work-in-process inventory? Group of…

A: An asset refers to the resource of the business that can be utilized for the purpose of revenue…

Q: lassification costs

A: A long-term physical piece of property or equipment that a company owns and utilises in its…

Q: total accrued cost of the project includes all the direct cost.  true or false?

A: Accrued expenses are those expenses that are identified before it has been paid. Expenses are…

Q: i. Define the term contract. ii. State the objectives of Contract costing Identify types of…

A: As per Bartleby policy, only the first three parts of the interlinked question are answered Contract…

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A: Introduction: Cost Accounting: Cost Accounting is for Internal users. For determining costs of the…

Q: After recognition, exploration and evaluation assets are accounted for under the cost model…

A: There are two methods are prescribed by IAS 16 Property, Plant and Equipment for acccount for the…

Q: Under the completed-contract method, the Contract Asset/Liability account balance will consist of O…

A: The completed contract method is an accounting approach where revenue and expenses from long-term…

Q: Depreciated replacement cost is equal to the *   a. Sound Value b. Net appreciation c.…

A: The depreciation expense is charged on fixed asset as reduced value of fixed asset with the passage…

Q: Kindly answer questions 1-3: 1.) Discretionary costs are costs that must be incurred because of past…

A: ANSWER 1) Discretionary cost is a cost which is not essential for the operation of business.Such…

Q: Which of the following is not a fixed cost?a. Direct materialsb. Depreciationc. Lease charged.…

A: Fixed cost is the cost which will be borne by the company irrespective of the units produced.

Q: VIII - Methods of Construction Accounting-Unprofitable Contract (Estimated Gross Loss) NeCombs…

A: Since the student has specifically asked for computing the due from/to customers under the…

Q: Classify the following fixed costs as normally being either committed or discretionary:a.…

A: Committed fixed costs are those costs that can not be reduced even for short periods of time without…

Q: When a transaction involves multiple performance obligations in a single transaction Select one :…

A: Answer  As per the IFRS 115 revenue recognition  the revenue should only be recognized only when…

Q: Which of the following expenditures cannot be included in R&D costs? a. indirect costs b.…

A: R & D: R & D means Research and Development which indicates as a process of obtaining new…

Q: DOCUMENTATION DELIVERABLES ARE SOMETIMES SHOWN AS SEEPARATE COSTS   IN THE PROJECT COST ESTIMATE.…

A: Stock holders are need to evalute the deliverable documentation costs are treated as seperate costs.

Q: Th e valuation technique under which assets are recorded at the amount that would be received in an…

A: The assets of a business can be recorded by valuation using current cost basis or the market value…

Q: What guidance does the Codification provide on the accrual of costs associated with planned major…

A:

Q: Which of these costs are taken as a part of cost of assets?   I. Invoice price II. Transportation…

A: Invoice price is the price at which the asset is purchased from the manufacturer or retailer of the…

Q: 27) Which among the following cost encourage management to focus on life cycle costing? a. All the…

A: Solution:  following cost encourage management to focus on life cycle costing: 1. Maintenance costs…

Q: how long-term construction contract are accounted for and some of the issues that are faced for…

A: Long-term construction contract is reported in financial statements is as follows: At the end of…

Q: Discuss the following methods used in measuring cost and rent recoveries             (i)…

A: Cost measurement is necessary to know that how much cost is incurred either to manufacture or a…

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.