On December 15, 2021, Rigsby Sales Co. sold a tract of land that cost $3,600,000 for $4,500,000 Rigsby oppropriately uses the installment sales method of accounting for this transaction. Terms called for a down payment of $500,000 with the balance in two equal annual installments payable on December 15, 2022, and December 15, 2023. Ignore interest charges. Rigsby has a December 31 year-end. At December 31, 2022, Rigsby would report in its balance sheet
On December 15, 2021, Rigsby Sales Co. sold a tract of land that cost $3,600,000 for $4,500,000 Rigsby oppropriately uses the installment sales method of accounting for this transaction. Terms called for a down payment of $500,000 with the balance in two equal annual installments payable on December 15, 2022, and December 15, 2023. Ignore interest charges. Rigsby has a December 31 year-end. At December 31, 2022, Rigsby would report in its balance sheet
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Multiple Choice
Deferred gross profit of $400,000
Realized gross profit of $400,000
Realized gross profit of $500,000
Cost of installment sales $1.500,000.
Transcribed Image Text:On December 15, 2021, Rigsby Sales Co, sold a tract of land that cost $3,600,000 for $4,500,000 Rigsby oppropriately uses the installment sales method of
accounting for this transaction. Terms called for a down payment of $500,000 with the balance in two equal annual installments payable on December 15, 2022, and
December 15, 2023. Ignore interest charges. Rigsby has a December 31 year-end.
At December 31, 2022, Rigsby would report in its balance sheet:
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