Ryan inc. began operations on Janurary 1, 1986, and appropriately uses the installment method of accounting. The following data are available for 1986:
Installment A/R, 12/31/86 $600,000
Installment Sales for 1986 1,050,000
Gross Profit on Sales 40%
Under the installment method, Ryan's deferred gross profit at December 31, 1986 would be:
a. $360,000
b. $270,000
c. $240,000
d. $180,000