FORMULAS ON INSTALLMENT SALES

1. Installment Sales
P XXX
Less: Cost of Installment Sales
XXX
Deferred Gross Profit Before Adjustment
PXXX
OR
Installment Sales x Gross Profit Rate = Deferred Gross
Profit Before Adjustment
2. Installment A/R x Gross Profit Rate = Deferred Gross
Profit After Adjustment / Deferred Gross Profit, end
OR
Installment Sales Collection = Installment Accounts
Receivable x Gross Profit Rate = Deferred Gross Profit
After Adjustment / Deferred Gross Profit, end
Or
Installment Sales Collection = Installment Accounts
Receivable Accounts Written Off x Gross Profit Rate =
Deferred Gross Profit After Adjustment / Deferred Gross
Profit, end
3. Deferred Gross Profit before adjustment
PXXX
Less: Deferred Gross Profit After Adjustment / Deferred Gross
Profit, end
XXX
Realized Gross Profit
PXXX

OR
Installment Sales
PXXX

Less: Installment Accounts Receiva

XXX
Collection
Multiply by Gross Profit Rate
%
Realized Gross Profit

PXXX
PXXX