问题
单项选择题
If a reliable estimate of total costs of the contract does NOT exist, which of the following revenue recognition methods should be used（）
A. Completed contract method.
B. Percentage-of-completion method.
C. Cost recovery method.
答案
参考答案：A
解析：
The cost recovery method is used when future cash collections are not assured even after receipt of partial payments. Gross profit is not recognized until all of the cost of goods sold is collected. The percentage-of-completion method is used when ultimate payment is assured and revenue is earned as costs are incurred. Profit is recognized corresponding to the percentage of costs incurred to the total estimated.