Installment sales method: Under the installment sales, the revenue and costs are recognized only when the payment of cash is received from customer. Two composed components are involved in the each payment of cash, and components of sales are as follows: Partial recovery of the cost from sales Component of gross profit These components are determined by the percentage of gross profit. To determine: The balance of deferred gross profit account at the end of 2017.

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Chapter 5, Problem 5.36BE

To determine

Installment sales method:

Under the installment sales, the revenue and costs are recognized only when the payment of cash is received from customer. Two composed components are involved in the each payment of cash, and components of sales are as follows:

Partial recovery of the cost from sales

Component of gross profit

These components are determined by the percentage of gross profit.

To determine: The balance of deferred gross profit account at the end of 2017.

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