1-

Al Tawaan Plastics entered into a contract to install a pipeline for a fixed price of OR2,200,000. Al Tawaan uses the cost recovery method of revenue recognition.

2015 2016 2017

Cost incurred 250,000 1,600,000 450,000

Estimated cost to complete 1,550,000 500,000 0

In 2015, Al Tawaan would report (rounded to the nearest thousand) gross profit (loss) of:

Select one:

a. OR 73,000

b. OR 0

c. OR 56,000

d. OR (100,000)

2-

Al Tawaan Plastics entered into a contract to install a pipeline for a fixed price of OR2,200,000. Al Tawaan uses the cost recovery method of revenue recognition.

2015 2016 2017

Cost incurred 250,000 1,600,000 450,000

Estimated cost to complete 1,550,000 500,000 0

In 2016, Al Tawaan would report (rounded to the nearest thousand) gross profit (loss) of:

Select one:

a. OR(223,000)

b. OR(206,000)

c. OR(150,000)

d. OR0.

3-

Al Tawaan Plastics entered into a contract to install a pipeline for a fixed price of OR2,200,000. Al Tawaan uses the cost recovery method of revenue recognition.

2015 2016 2017

Cost incurred 250,000 1,600,000 450,000

Estimated cost to complete 1,550,000 500,000 0

In 2017, Al Tawaan would report (rounded to the nearest thousand) gross profit (loss) of:

Select one:

a. OR 50,000

b. OR 2,000

c. OR(100,000)

d. OR 123,000