Use the following information for questions.

-Which of the following should be shown on the statement of financial position at December 31, 2017 related to Contract 2?
A)inventory, $272,000
B)inventory, $328,000
C)liability, $272,000
D)liability, $600,000

Question

Use the following information for questions.
 
-Which of the following should be shown on the statement of financial position at December 31, 2017 related to Contract 2?
A)inventory, $272,000 
B)inventory, $328,000 
C)liability, $272,000 
D)liability, $600,000

Quizplus · Accepted Answer

Contract 2 has a liability of $272,000, which should be shown on the statement of financial position. The inventory related to this contract is not relevant to the statement of financial position, as it is an asset and not a liability.

Use the Following Information for Questions