Problem:
Foghorn Leghorn Corporation began selling goods on the installment basis on January 1, 2008.
During 2008, the company had installment sales of $170,000, cash collections of $66,000, and cost of installment sales of $119,000.
Prepare the company's entries to record installment sales, cash collected, cost of installment sales, deferral of gross profit, and gross profit recognized, using the installment-sales method.