If an overall loss is projected on a long-term construction project, when is it recognized under the percentage of completion method?
A)In the period it occurred
B)In the period it was estimated
C)In the last period of the job
D)In each period the job is in process

Question

Quizplus · Accepted Answer

Under the percentage of completion method, if an overall loss is projected on a long-term construction project, it is recognized immediately in the period it was estimated. This approach ensures that financial statements reflect the most current and accurate information regarding the project's financial health.

If an Overall Loss Is Projected on a Long-Term Construction