(Installment Sales—Default and Repossession) Michael Johnson Imports Inc. was involved in two default and repossession cases during the year:

1. A refrigerator was sold to Merlene Ottey for $1,800, including a 35% markup on selling price. Ottey made a down payment of 20%, four of the remaining 16 equal payments, and then defaulted on further payments. The refrigerator was repossessed, at which time the fair value was determined to be $800.

2. An oven that cost $1,200 was sold to Donovan Bailey for $1,600 on the installment basis. Bailey made a down payment of $240 and paid $80 a month for six months, after which he defaulted. The oven was repossessed and the estimated value at time of repossession was determined to be $750.

Instructions Prepare journal entries to record each of these repossessions using a fair value approach. (Ignore interest charges.)