Cost Recovery Analysis
Hatch Enterprises uses the cost recovery method for all installment sales. Complete the following table.
|
|
2007 |
2008 |
2009 |
|
Installment sales |
$92,000 |
$103,000 |
$ (1) |
|
Cost of installment sales |
(2) |
62,830 |
74,750 |
|
Gross profit percentage |
36% |
(3) |
35% |
|
Cash collections: |
|
|
|
|
2007 sales |
27,200 |
48,300 |
12,200 |
|
2008 sales |
|
36,600 |
(4) |
|
2009 sales |
|
|
43,450 |
|
Realized gross profit on installment sales |
(5) |
(6) |
19,250 |