Question - The following information was taken from the records of Locken Corporation for the years indicated, The company's year end is Dec 31.
2005 2006 2007
Installment sales 450,000 500,000 620,000
Cost of sales 342,000 360,000 434,000
Cash Receipts
2005 sales 125000 280000 45000
2006 sales 0 210000 230,000
2007 sales 0 0 250,000
A. Calculate the amount of realized gross profit on installment sales and deferred gross profit to be reported in the year end financial statements of Locken Corporation for the three years noted.
B. Prepare all journal entries required in 2007.