Refer to LaGrow Developers.Assuming that LaGrow uses the installment sales method,the company would recognize gross profit in 2017 of ________.
A)$0
B)$1,000,000
C)$1,500,000
D)$2,500,000

Question

Quizplus · Accepted Answer

LaGrow uses the installment sales method, which means that it recognizes gross profit on installment sales over the period in which the payments are collected. In 2017, LaGrow collected $1,000,000 of payments on the installment sale, so it would recognize $1,000,000 of gross profit in 2017.