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The Completed-contract method is an accounting method of work-in-progress evaluation, for recording long-term contracts. GAAP allows another method of revenue recognition for long-term construction contracts, the percentage-of-completion method.
The deferred gross profit is an A/R contra-account and is the difference between gross profit and recognized income and is calculated as follows: $360,000 − $90,000 = $270,000. The deferred gross profit is thus deferred and recognized in income in subsequent periods, i.e. when the installment receivables are collected in cash.
Revenues and gross profit are recognized each period based on the construction progress, in other words, the percentage of completion. Construction costs plus gross profit earned to date are accumulated in an asset account (construction in process, also called construction in progress), and progress billings are accumulated in a liability account (billing on construction in process).
Under this method, revenues, costs, and gross profit are recognized only after the project is fully completed. Thus, if a company is working only on one project, its income statement will show $0 revenues and $0 construction-related costs until the final year.
The dura mater covering the spinal cord is known as the dural sac or thecal sac, and only has one layer (the meningeal layer) unlike cranial dura mater. The potential space between these two layers is known as the epidural space , [ 5 ] which can accumulate blood in the case of traumatic laceration to the meningeal arteries .
The diaphragma sellae or sellar diaphragm is a small, circular sheet of dura mater forming an (incomplete) roof over the sella turcica and covering the pituitary gland lodged therein. The diaphragma sellae forms a central opening to accommodate the passage of the pituitary stalk (infundibulum) [ 1 ] which interconnects the pituitary gland and ...
For financial accounting purposes, accrual accounting generally follows the principle that revenue cannot be recognized until it is earned, even if payment has been received in advance. [7] The specifics of accrual accounting can vary across jurisdictions, though the overarching principle of recognizing revenue and expenses when they are earned ...
The dura mater (Latin: tough mother), [6] [a] is a thick, durable membrane, closest to the skull and vertebrae.The dura mater, the outermost part, is a loosely arranged, fibroelastic layer of cells, characterized by multiple interdigitating cell processes, no extracellular collagen, [citation needed] and significant extracellular spaces.