What realized gross profit on installment sales during year

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Problem 1: BULLOCK Inc. sells automatic weapons costing P 700,000 at a price of P 1,200,000. CARUSO Corp. buys a dozen of automatic weapons on installment and tradein six of its old weapons at a trade-in value of P 300,000 each. BEX-1. On July 1, 2016, MUSCALA Motors, which maintains a perpetual inventory records sold a new automobile to LAX for P 1,700,000. The car costs the seller P 1,301,250. The following were the payment scheme in order: 1. 30% down payment 2. P 160,000 allowance on an old car traded 3. The balance being payable in equal monthly installments The monthly amortization amounts to P 60,000 inclusive of 12% interest on the unpaid amount of the obligation. The car traded in has a wholesale value of P 240,000 after expending reconditioning costs of P 45,000. After paying three installments, the buyer suffered major financial setback incapacitating him to continue paying so the car was subsequently repossessed. When reacquired, the car was appraised to have a fair value of P 600,000. What is the realized gross profit on installment sales during the year?

Reference no: EM132669637

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