F2- HW Question help!

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  • February 29, 2012 at 2:31 am #167388
    Anonymous
    Inactive

    Sorry , it must be Monday, I cannot think straight. But please could you explain why it is a LIABILITY if the project billings are more than the incurred cost and is not considered a current asset? I mean, if the company incurred more costs on their part than what was estimated in the contract, shouldn’t it be a loss for that company?

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  • February 29, 2012 at 2:36 am #328824
    jenuno01
    Member

    From what I can remember, It's Because you've billed for costs you haven't incurred or technically services you haven't performed.. So it's Unearned… And unearneds are liabilities…

    Class of 2012

    February 29, 2012 at 2:43 am #328825
    Anonymous
    Inactive

    omg now it makes more sense!! Thanks!

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