Parker Clothing Company sells its products on an installment sales basis. Data for 2012 and 2013 follow:

a. Compute the net income for 2013, assuming use of the accrual (sales) basis of revenue recognition.

b. Compute the net income for 2013, assuming use of the installment basis of recognizinggross margin.

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2012 2013 Installment sales... $800,000 $960,000 Cost of goods sold on installment sales 560,000 720,000 Other expenses..... 120,000 160,000 Cash collected from 2012 sales. 480,000 240,000 Cash collected from 2013 sales. 640,000