On December 15, 2018, Rigsby Sales Co. sold a tract of land that cost $3,200,000 for $5,000,000. Rigsby appropriately uses the installment sales method of accounting for this transaction. Terms called for a down payment of $460,000 with the balance in two equal annual installments payable on December 15, 2019, and December 15, 2020. Ignore interest charges. Rigsby has a December 31 year-end. In its December 31, 2018, balance sheet, Rigsby would report:
Installment receivables (net) of $2,905,600.
Realized gross profit of $165,600.
Installment receivables (net) of $4,540,000.
Deferred gross profit of $165,600.
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