QUESTION 3construction finanace When the sum of cost incurre

QUESTION 3-construction finanace

When the sum of cost incurred and expected profit is larger than amount billed, the difference is recorded on the balance sheet as

Account receivable

Liability

Underbilling

Overbilling

Solution

Option C is correct. When the sum of cost incurred and expected profit is larger than amount billed, the difference is recorded on the balance sheet as Underbilling