The Naples Company uses the percentage-of-completion method and the cost-to-cost method for its long-term construction contracts. On one such contract, Naples expects total revenues of P260,000. During the first year, Naples incurred costs pf P50,000 and billed the customer P30,000 under the contract. At what net amount should Naples Construction in Progress for this contract be reported at the end of the first year? a. P 35,000 b. 65,000

CONCEPTS IN FED.TAX.,2020-W/ACCESS
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Chapter5: Introduction To Business Expenses
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The Naples Company uses the percentage-of-completion method and the cost-to-cost method for its long-term

construction contracts. On one such contract, Naples expects total revenues of P260,000. During the first

year, Naples incurred costs pf P50,000 and billed the customer P30,000 under the contract. At what net amount

should Naples Construction in Progress for this contract be reported at the end of the first year?

a. P 35,000

b. 65,000

 

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