单选题

Which of the following about a company using the percentage of completion accounting method for long-term contracts, compared to company that uses the completed contract method is FALSE?（）

A、 Actual cash flow will be greater in the first year.
B、 Equity will be higher in the first year.
C、 Earnings will be the same over the life of the contract.

【正确答案】 A

【答案解析】

Earnings will be higher, but cash flows do not increase.