When is revenue recognized under the percentage of completion method?
A) When construction begins on the project.
B) When the project is complete.
C) Throughout the project, based upon the amount of work completed each year.
D) Throughout the project, based upon the amount of cash received from the customer.

Question

Quizplus · Accepted Answer

The percentage of completion method recognizes revenue throughout the project based on the progress or amount of work completed each year. This method is commonly used in long-term contracts and projects, allowing revenue and expenses to be recorded in the periods in which the work is performed.

When Is Revenue Recognized Under the Percentage of Completion Method