Question:
Dolce Co., which began operations on January 1, 2013, appropriately uses the installment sales method of
accounting to record revenues. The following information is available for the years ended December 31,
2013 and 2014:
What amount of installment accounts receivable should Dolce report in its December 31, 2014, balance
sheet?
a. $1,700,000
b. $1,225,000
c. $1,300,000
d. $1,775,000
Answer:
3. a.
Year of sale
2013 2014
a. Gross profit realized $240,000 $200,000
b. Percentage 30% 40%
c. Collections on sales (a/b) $800,000 $500,000
Sales 1,000,000 2,000,000
Balance uncollected
Dolce Co., which began operations on January 1, 2013, appropriately uses the installment sales method of
accounting to record revenues. The following information is available for the years ended December 31,
2013 and 2014:
What amount of installment accounts receivable should Dolce report in its December 31, 2014, balance
sheet?
a. $1,700,000
b. $1,225,000
c. $1,300,000
d. $1,775,000
Answer:
3. a.
Year of sale
2013 2014
a. Gross profit realized $240,000 $200,000
b. Percentage 30% 40%
c. Collections on sales (a/b) $800,000 $500,000
Sales 1,000,000 2,000,000
Balance uncollected
