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How much is the deferred gross profit at the end

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Question - Bell Co. uses the "installment sales method." In 20x1, Bell Co. sells an inventory costing $450,000 for an installment sale price of 600,000. Bell makes the following collections: 20x1, 400,000; 20x2, 150,000; and 20x3, 50,000.

Q1. How much are the realized gross profits in 20x1?

a. 89,000

b. 92,000

c. 100,000

d. 180,000

Q2. How much are the balances of installment accounts receivable at the end of 20x2?

a. zero

b. 10,000

c. 42,000

d. 50,000

Q3. How much is the deferred gross profit at the end of 20x3?

a. zero

b. 2,000

c. 6,000

d. 10,000

 

Reference no: EM132601477

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