Choices

AK Construction Company changed from the cost-recovery to the percentage-of- completion method of accounting for long-term construction contracts during 2018. For tax purposes, the company employs the cost-recovery method and will continue this approach in the future. The appropriate information related to this change is as .follows Pretax Income from Difference Cost Recovery Percentage-of-Completion $85,000 $305,000 $390,000 2017 110,000 240,000 350,000 2018 Assuming that the tax rate is 30%, what is the amount of net income that would be Preported in 2018 285,000 125,800 325,500 245.8m