Several of Fox Inc.'s customers are having cash flow problems. Information pertaining to these customers for the years ended March 31, 1998 and 1999, follows:
3/31/98 3/31/99
Sales $10,000 $15,000
Cost of Sales 8,000 9,000
Cash Collections
On 1998 Sales 7,000 3,000
On 1999 Sales - 12,000
If the cost-recovery method is used, what amount would Fox report as gross profit from sales to these customers for the year ended March 31,1999?
a. $2,000
b. $3,000
c. $5,000
d. $15,000