The Key Largo Company Uses the Percentage-Of-Completion Method to Recognize

Multiple Choice

The Key Largo Company uses the percentage-of-completion method to recognize profits on long-term contracts.At the end of the second year of the contract, a project was 70% complete and an overall loss of $100, 000 was expected.A $20, 000 profit had been recognized in the first year of the contract.The loss to be recognized in the second year is

A) $ 70, 000
B) $ 80, 000
C) $100, 000
D) $120, 000
E) none of these