Oliver Furnishings frequendy has sales involving no down payment and no payments for three months. Three months

Oliver Furnishings frequendy has sales involving €œno down payment and no payments for three months.€ Three months after the purchase date, customers make four equal monthly payments (i.e., they make equal payments 3, 4, 5, and 6 months after purchase). Each payment is one-quarter of the purchase price.
The company has a December 31 year-end. During 2012, the company made the following sales on installment plans. Oliver makes a 40% gross margin on these sales.

Required:
Using the installment sales method, record the journal entries for Oliver€™s installment sales made in the month of May and the subsequent payments received in August, September, October, and November. Assume all installment payments are received, and ignore the time value of money.

Transcribed Image Text:

Month January Februaty March April Total Sale price Month S80,000 May 70,000 Juc 90,000 July 100,000 August Sale price Month Sale price $90,000 September $100,000 90,000 130,000 150,000 S1,230,000 100,000 Octobe 120,000 November 110,000 December