A project estimate shows total expected cost of $860,000. Cost posted to date is $301,000. What estimated cost to complete remains?
Correct Answer
B) $559,000
Cost to complete is total expected cost less cost posted to date.
Why This Is the Correct Answer
Cost to complete is total expected cost less cost posted to date.
Why the Other Options Are Wrong
Option A: $539,000
$539,000 is below the supported result for cost to complete; it likely uses the wrong base, period, or account bucket.
Option C: $579,000
$579,000 is above the supported result for cost to complete; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $602,000
$602,000 is above the supported result for cost to complete; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Cost To Complete drawer for Manager Updates: label expected before counting dollars.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Section One, Accounting Methods, Percentage-of-Completion Method; use the job ledger figures in the stem and recompute the same accounting measure.
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