A television set costing $540 is sold to Jack Matre on November 1, 2010, for $900. Matre makes a down payment of $300 and agrees to pay $30 on the first of each month for 20 months thereafter. Matre pays the $30 installment due December 1, 2010. On December 31, 2010, the appropriate entries are made to record profit realized on the install- ment sales.
The first seven 2011 installments of $30 each are paid by Matre. (Make one entry.) In August 2011 the set is repossessed, after Matre fails to pay the August 1 installment and indi- cates that he will be unable to continue the payments. The estimated fair value of the repossessed set is $100.
Instructions
Prepare journal entries to record the transactions above on the books of TV Land Company. Closing en- tries should not be made.