Advanced Accounting 1

Advanced Accounting 1

by Dianne Regencia

​Construction Contracts

PFRS 15 Revenue from Contracts with Customers​

Multiple Choice

A construction contract in which the contractor agrees to a fixed contract price, or a fixed rate per unit of output, which in some cases is subject to cost escalation clauses.

• Fixed price contract

• Fixed cost contract

• Fixed contract

• Fixed rate contract

Multiple Choice

What is income arising in the course of an entity's ordinary activities?

• Discount

• Gain

• Revenue

• Profitit

Multiple Choice

It is an agreement between two or more parties that creates enforceable rights and obligations.

• Contract

• Lease

• Construction

• Strategy

Fill in the Blanks

A contract can be _______, ____, or _______ by an entity's customary business practice

Fill in the Blanks

A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration.

PFRS 15 Summary of Revenue Recognition​

1. ​Identify the contract with the customer

2. ​Identify the performance obligations in the contract

3. ​Determine the transaction price

4. ​Allocate the transaction price to the performance obligations

5. ​Recognize revenue when (or as) a performance obligation is satisfied

Multiple Choice

It is a contract specifically negotiated for the construction of an asset or a combination of assets that are closely interrelated or interdependent in terms of design, technology and function or their ultimate purpose or use.

• Marriage Contract

• Work Contract

• Lease Contract

• Construction Contract

Multiple Choice

At contract inception, the entity shall determine whether the identified performance obligations will be satisfied either:

• Over time or At a point in time

• Over a year or 5 years

• Over night or Over time

• At a convenient time or Over the counter

Multiple Choice

It is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (e.g. sales taxes).

• Transaction Price

• Price

• Transaction

• Unit Price

Multiple Choice

A construction contract in which the contractor is reimbursed for allowable or otherwise defined costs, plus a percentage of these costs or a fixed fee.

• Cost plus contract

• Plus cost contract

• Cost plus variable fee contract

• Cost plus fixed fee contract

Multiple Choice

The contractor is reimbursed for agreed costs with no provision for a fixed fee. An agreed percentage to the total reimbursable costs is applied. The total contract price is the sum of reimbursable costs and the percentage based on these costs.

• Cost plus contract

• Plus cost contract

• Cost plus variable fee contract

• Cost plus fixed fee contract

Multiple Choice

The contractor is reimbursed for agreed costs plus a provision for a fixed fee. The total contract price is the sum of reimbursable costs and the fixed fee

• Cost plus contract

• Plus cost contract

• Cost plus variable fee contract

• Cost plus fixed fee contract

Multiple Choice

It is the price at which a promised good or service can be sold separately to a customer.

• Selling price

• Stand-alone selling price

• Alone selling price

• Price