Paul Dobson Stores sell appliances for cash and also on the installment plan. Entries to record cost of sales are made monthly.

                             

The accounting department has prepared the following analysis of cash receipts for the year.

                                

Repossessions recorded during the year are summarized as follows.

                                                         2014 
Uncollected balance                      $8,000
Loss on repossession                          800
Repossessed merchandise               4,800

Instructions
From the trial balance and accompanying information:
  (a) Compute the rate of gross profit on installment sales for 2014 and 2015.
  (b) Prepare closing entries as of December 31, 2015, under the installment-sales method of accounting.
  (c) Prepare an income statement for the year ended December 31, 2015. Include only the realized gross profit in the income statement.