The board of directors of Ivanhoe Construction Company is meeting to choose between the costrecovery method and the percentageofcompletion method of accounting for longterm contracts in the company's financial statements. You have been engaged to assist Ivanhoe's controller in the preparation of a presentation to be given at the board meeting. The controller provides you with the following information:
Ivanhoe commenced doing business on January
Construction activities for the year ended December were as follows:
Each contract is with a different customer.
Any work remaining to be done on the contracts is expected to be completed in
a
Your answer is incorrect.
Compute the amount of income or loss before selling, general, and administrative expenses for the year ended December which would be reported under:
The costrecovery method.
The percentageofcompletion method based on estimated costs
