Marian Company sells furniture for cash and on the installment plan. Entries to record cost of sales are made monthly. The trial balance on December 31, 2011 is as follows: Marian Company Trial Balance December 31, 2011 Cash P 90,750 Installment contracts receivable, 2010 30,000 Installment contracts receivable, 2011 95,000 Inventory - New merchandise 77,500 Inventory - Repossessed merchandise 15,000 Accounts Payable Deferred gross profit, 2010 Ordinary Share Accumulated Profits P 60,875 27,000 125,000 52,500 Cash sales Installment sales Cost of sales Cost of installment sales Gain or loss on repossessions 265,000 187,500 206,250 121,875 500 Selling and administrative expenses The accountant has prepared the following analysis of cash receipts for the year: 82,500 P719,375 P719,375 Cash sales Installment contracts receivable, 2010 Installment contracts receivable, 2011 Others Total P265,000 65,000 92,500 22,500 P445,000 Data pertaining to the repossession recorded during the year are summarized as follows: Requirements: Uncollected balance Loss on repossession Repossessed merchandise 2010 P5,000 500 3,000 1. From the trial balance and accompanying information, compute the gross profit rate on installment sales for 2010 and 2011. 2. Prepare adjusting and closing entries as of December 31, 2011 under the installment method of accounting. 3. Prepare an Income Statement for the year ended December 31, 2011.