Revenue recognition for construction and service contracts requires percentage-of-completion method, with specified project-completion and straight-line alternatives. Revenue from construction and service contracts is to be recognised using the percentage of completion method under the applicable income computation and disclosure standards. Short-duration service contracts employ a project completion method and contracts with an indeterminate number of acts over a specified period use a straight line method. Contract revenue includes retention money and contract costs must not be reduced by incidental income like interest, dividends or capital gains.
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Provisions expressly mentioned in the judgment/order text.
Revenue recognition for construction and service contracts requires percentage-of-completion method, with specified project-completion and straight-line alternatives.
Revenue from construction and service contracts is to be recognised using the percentage of completion method under the applicable income computation and disclosure standards. Short-duration service contracts employ a project completion method and contracts with an indeterminate number of acts over a specified period use a straight line method. Contract revenue includes retention money and contract costs must not be reduced by incidental income like interest, dividends or capital gains.
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