A taxpayer that is using the installment sale method to recognize gain must recompute the gross profit percentage every year during the term of the installment note.

Name: A taxpayer that is using the installment sale method to recognize gain must recompute the gross profit percentage every year during the term of the installment note.
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Question

Quizplus · Accepted Answer

The gross profit percentage is determined at the time of the sale and remains fixed throughout the duration of the installment payments; it is not recomputed each year.

A Taxpayer That Is Using the Installment Sale Method to Recognize