On January 1, 2008, Tom Brands sells 200 acres of farmland for $600,000. Tom Brands purchased the farmland in 1995 at a cost of $500,000. The sale price will be paid in three installments of $200,000 each on December 31, 2008, 2009, and 2010. Collectibility of the payments is uncertain; Tom, therefore, uses the cost-recovery method.

Instructions

Determine the realized gross profit that Tom should recognize on December 31, 2008, 2009, and 2010.