completed contract method


completed contract method
Completed contract method.
A method of reporting profit or loss on certain long-term contracts. Under this method of accounting, gross income and expenses are recognized in the tax year in which the contract is completed. This method should be used only when the conditions or terms of the contract do not permit use of the percent of completion method.
See also accounting.
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A method used in accounting to report profit or loss on long term contracts in the year the contract is complete, except that losses must be recognized in the year incurred. This method differs from the percent of completion method where revenues and expenses are recorded over the life of the contract in accordance with the level of progress. The completed contract method is not allowed for tax purposes for long term contracts entered into after February 28, 1986. The acceptable methods for contracts entered into after February 28, 1986 include; percent of completion and percent of completion-capitalized cost method which combines the elements of the completed contract and percent of completion methods.

Black's law dictionary. . 1990.

Look at other dictionaries:

  • completed contract method — Completed contract method. A method of reporting profit or loss on certain long term contracts. Under this method of accounting, gross income and expenses are recognized in the tax year in which the contract is completed. This method should be… …   Black's law dictionary

  • completed contract method — An accounting method that does not record the income and expenses of a long term project until the project is completed. See also accrual method, cash method. Webster s New World Law Dictionary. Susan Ellis Wild. 2000 …   Law dictionary

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  • Completed contract — Der International Accounting Standard 11 (IAS 11) ist eine Rechnungslegungsvorschrift des IASB über die Bilanzierung von Erträgen und Aufwendungen von Fertigungsaufträgen. Das sind solche Aufträge, die kundenspezifische Merkmale aufweisen, etwa… …   Deutsch Wikipedia

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  • Percentage Of Completion Method — An accounting method in which the revenues and expenses of long term contracts are recognized yearly as a percentage of the work completed during that year. This is the opposite of the completed contract method, which allows taxpayers to defer… …   Investment dictionary

  • accrual method — n: accrual basis at basis Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. accr …   Law dictionary

  • cash method — cash meth·od n: cash basis at basis Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. cash method …   Law dictionary


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