(Installment-Sales Computations and Entries) Presented below is summarized information for Deng Yaping Co., which sells merchandise on the installment basis.

Instructions

(a) Compute the realized gross profit for each of the years 2007, 2008, and 2009.

(b) Prepare in journal form all entries required in 2009, applying the installment-sales method of accounting. (Ignore interest charges.)

2007 2008 2009 Sales (on installment plan) Cost of sales $250,000 150,000 Gross profit Collections from customers on: 2007 installment sales 2008 installment sales 2009 installment sales $260,000 163,800 $100,000 $ 96,200 $ 75,000 $100,000 100,000 $280,000 182,000 $ 98,000 $ 50,000 120,000 110,000