Sales Under the Installment Method The following information is available for the Butler Company in 2007, its first year of operations:
|
Total credit sales (including installment method sales) |
$205,000 |
|
Total cost of goods sold (including installment method cost of goods sold) |
130,000 |
|
Installment method sales |
65,000 |
|
Installment method cost of goods sold |
39,000 |
|
Cash receipts on credit sales (including installment method sales of $20,000) |
120,000 |
Required
1. Prepare the journal entries for 2007.
2. If the company collected $45,000 in 2008 on its 2007 installment method sales, prepare the appropriate journal entries in 2008.