Financial Reporting and Analysis Q78

0. Under US GAAP, a revenue recognition method used for long-term projects where the outcome cannot be measured reliably is most likely the:

Answer
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Option : B
Explanation : When the outcome can be measured reliably the percentage-ofcompletion method is used. When the outcome cannot be measured reliably the completed contract method is used. The cost recovery method is used for installment sales, not for long- term projects.

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