b. Compute for the balance of the installment receivable at thea. Compute for the realized gross profit in each of the years 20x11. Ring Co. uses the "installment sales method." Information oPROBLEM 4: FOR CLASSROOM DISCUSSIONInstallment sales methodRing Co.'s sales and collections is as follows:20x1us20x21,000,000700,0001,300,000Installment sales845,000Cost of salesCollections:500,000* 300,000- from 20x1 sales650,000- from 20x2 salesRequirements:and 20x2.b. Compute for the balance of the installment receivable at t.end of each of the years 20x1 and 20x2.c. Compute for the deferred gross profit at the end of each of theyears 20x1 and 20x2.

The installment sales method is a method where profit is recognised when the cash is received.

PRÒ 1. Ring Co. uses the "installment sales method." Information o - Compute for the realized gross profit in each of the years 20x1 Installment sales method on 20x1 20x2 1,300,000 1,000,000 Installment sales Cost of sales Collections: - from 20x1 sales - from 20x2 sales 700,000 845,000 500,000 * 300,000 650,000 Requirements: b. Compute for the balance of the installment receivable at the end of each of the years 20x1 and 20x2. . Compute for the deferred gross profit at the end of each of the and 20x2.

PRÒ 1. Ring Co. uses the "installment sales method." Information o - Compute for the realized gross profit in each of the years 20x1 Installment sales method on 20x1 20x2 1,300,000 1,000,000 Installment sales Cost of sales Collections: - from 20x1 sales - from 20x2 sales 700,000 845,000 500,000 * 300,000 650,000 Requirements: b. Compute for the balance of the installment receivable at the end of each of the years 20x1 and 20x2. . Compute for the deferred gross profit at the end of each of the and 20x2.

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

100%

b. Compute for the balance of the installment receivable at the
a. Compute for the realized gross profit in each of the years 20x1
1. Ring Co. uses the "installment sales method." Information o
PROBLEM 4: FOR CLASSROOM DISCUSSION
Installment sales method
Ring Co.'s sales and collections is as follows:
20x1
us
20x2
1,000,000
700,000
1,300,000
Installment sales
845,000
Cost of sales
Collections:
500,000
* 300,000
- from 20x1 sales
650,000
- from 20x2 sales
Requirements:
and 20x2.
b. Compute for the balance of the installment receivable at t.
end of each of the years 20x1 and 20x2.
c. Compute for the deferred gross profit at the end of each of the
years 20x1 and 20x2.

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