A construction firm was contracted to build a bridge for $100 000 000.It is estimated that the total cost will be roughly $95 000 000 spread over five years,but it is unable to estimate reliably the yearly percentage of completion.Under the completed contract method,what amount of profit will be recorded in Year 2?
A)$5 000 000
B)$0
C)$1 000 000
D)none of the above

Question

Quizplus · Accepted Answer

Under the completed contract method, revenue, expenses, and profit are recognized only when the project is completed. Therefore, no profit will be recorded in Year 2 as the project is not yet completed.

A Construction Firm Was Contracted to Build a Bridge for $100