On March 1, 2018, $60,000 of annual magazine subscriptions were sold by Traveler's Monthly Magazines. The subscribed magazines are delivered on the first day of each month beginning on March 1, 2018. The total cost of the subscribed magazines is $30,000 or $2,500 per month. How much profit will the company recognize during 2018?

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The company will recognize $25,000 profit during 2018. Revenue is recognized monthly as the magazines are delivered. For 10 months (March to December), revenue is $50,000 ($60,000/12*10) and cost is $25,000 ($30,000/12*10), resulting in a profit of $25,000.

On March 1, 2018, $60,000 of Annual Magazine Subscriptions Were