Brief Exercise 6-2 (Static) Timing of revenue recognition [LO6-3]

Estate Construction is constructing a building for CyberB, an online retailing company. Under the construction agreement, if for any reason Estate cant complete construction, CyberB would own the partially completed building and could hire another construction company to complete the job. When should Estate recognize revenue: as the building is constructed, or after construction is completed?

multiple choice

• As the building is constructed

• After construction is completed

• When the construction agreement is signed