ACCOUNTING INTERMEDIATE II PRACTICE QUESTIONS:

PLEASE BRIEFLY answer

1. The principle of Revenue Recognition states that revenue should be recognized when transfer of promised goods or services to customers has taken place and the amount of the transaction represents a reasonable consideration. It also states that the revenue must be eamed. How is the point of revenue recognition different when it comes to long-term construction contracts in which revenue is recognized based on percentage of completion? (10 Points) Briefly explain and to the point