Reference no: EM133172885

Question - The Bass Co., on September 30, 20x1, sold for P48,000 a piano costing P30,000. The down payment was P4,800 and an equal amount was to be paid at the end of each succeeding month. Monthly interest of 1% yield rate was to be charged on the unpaid balance of the installment contract, with payment applying first to accrued interest and the balance to principal. After paying a total of P19,200, the customer defaulted and the piano was correspondingly repossessed on February 28, 20x2, at which time it was estimated to have a value of P16,800 on a depreciated cost basis. Bass Co. uses a perpetual inventory system and records the total deferred gross profit at the time of sale. How much was the realized gross profit at the end of 20x1.