The installment sale method of accounting does not apply to which of the following sales?
A) Sale of 12-acre tract of land held as inventory by a real estate developer
B) Sale of business equipment
C) Sale of U.S. Treasury notes
D) The method does not apply to the sale of 12-acre tract of land held as inventory by a real estate developer or to the sale of U.S. Treasury notes.

Question

Quizplus · Accepted Answer

The installment sale method of accounting is generally used for sales where payments are received over time after the sale of property. However, it does not apply to sales of inventory or to sales of stocks and securities like U.S. Treasury notes. A real estate developer holding a 12-acre tract of land as inventory and the sale of U.S. Treasury notes both fall into these exceptions.

The Installment Sale Method of Accounting Does Not Apply to Which