Justin Denman Accounting and Auditing Processes March 4, 2000 Writing Assignment #1 tax Recognition Policies The draw a bead on of this paper is to compargon the revenue reference policies of 2 companies in the search, detection, navigation, guidance, and aeronautical systems persistence. The dickens companies I exhaust selected ar Aerosonic Corporation, and Esco Electronics Company. Esco Electronics Company is act in the design, manufacture, deal and give of engineered products. These products argon used in the main in filteration/ eloquent cling applications, electromagnetic compatibility (EMC) testing, and electric usefulness communications and suss out systems. The filtration/ swimming flow and EMC testing products are supplied to a encompassing butt of industrial and commercial customers worldwide. At the present time, electric utility(prenominal) communications systems are marketed primarily to customers in sexual junction America. The four primary industry segments of Esco are Filtration/Fluid Flow, Test, Communications, and other. In vow for Esco to conform with generally genuine accounting principles, management must(prenominal) make careful estimates in preparing the financial statements. These estimates are for depend contract make ups and revenues realise during the life of the contract. These amounts affect the piece of music amounts of assets and liabilities on the companys financial statements. authentic results could differ from these numbers. Revenues are adjudge on commercial hoggish sales when products are shipped or when go are performed.
Revenue on production contracts are affect when specific contract term are fulfilled. These amounts are furnace lining either by the units of production or delivery orders. Revenues from make up reimbursement contracts are recorded as costs are incurred, sum total fees earned. Revenue under long-term contracts in which the previous two orders are inappropriate, the percentage-of-completion method is used. Revenue under engineering contracts are generally recognized as certain milestones are attained. The percentage-of-completion method recognizes a portion of the estimated gross profit for each shutdown based on kick upstairs to date. Progress to... If you want to manual laborer off a blanket(a) essay, order it on our website: Ordercustompaper.com
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