Answered: Daisy incorporated sells equipment on…

Daisy incorporated sells equipment on installment basis aat 25% mark up on cost. Installment sales for the past four years were: 4,

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Daisy incorporated sells equipment on installment basis aat 25% mark up on cost. Installment sales for the past four years were: 4,906,660 in 2018, 3,560,900 in 2019, 7,840,480 in 2020 and 8,960,690 on 2021. Terms of the sale are as follows; Down payment of 10%, 15% of the balance is collected in the year of sale, 20% a year after sale, 35% two years after the year of sale, and the remaining amountwill be collected three years after the year of sale. Determine the realized gross profit in 2021

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