Construction job on the income statement

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Krystal has been approached by a junior manager from a company serviced by Krystal's firm. This manager wants Krystal to explain a revenue amount on his company's newly issued interim statements, compiled by Krystal, for the company's 3rd quarter. The revenue amount on the income statement does not include the entire amount to be earned on a construction project to be completed by the end of the year. The manager wanted to know why Krystal failed to recognize all of the revenue from the job in progress even though all significant work had not been completed on the job.

Should Krystal have included all of the revenue from the construction job on the income statement? Why or why not?

Reference no: EM132440320

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