Recognized Gross Profit on an Installment Sale
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Kyle sold land on the installment basis for $100,000. His basis in the land was $70,000. Kyle received a $40,000 down payment and a real estate installment sale contract calling for $60,000 in additional payments in future years. In addition, Kyle paid $6,000 in commissions on the sale. What is the gross profit to be recognized in the current year?
A. $0
B. $9,600
C. $12,000
D. $30,400
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Solution Summary
This solution provides the correct answer, explanation, and calculations to the gross profit question listed. This question is based on Kyle selling land on an installment basis.
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