The installment method of revenue recognition is primarily used for: a) Service contracts b) Construction projects c) Sales with extended payment terms. d) Consignment sales

Demonstrate revenue recognition for long-term contracts, both at a point intime when the contract is completed and over a period of time according to thepercentage completed.

Distinguish between the stand-alone and the incremental revenue-allocation methods.

What are the two methods of revenue recognition for long-term construction projects?

Provide answer

For long-term construction projects, the amount of “billings” is reported in the balance sheet by: Multiple Choice   netting it against “construction in progress.”   adding it to “construction in progress.”   adding it to “accounts receivable.”   netting it against “accounts receivable.”

For assets acquired on credit or by installment, the cost or fair value is equal to: A. cash purchase priceB. invoice priceC. installment priceD. list price

1. 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.

The concept that states assets should be recorded at their original cost is known as the: a) Matching Principle b) Cost Principle c) Consistency Principle d) Revenue Recognition Principle

(e) What was the amount of restoration cost recognised in profit or loss during the current reporting period?