Maxwell Appliances accounts for all sales of its merchandise on the installment basis. Attached is the unadjusted trial balance at 12/31/X5. The following additional information is available for the current year

(a)

The gross profit percentage for 20X3 was 25%

(b)

Total cash receipts during 20X5 were $125,000.

(c)

Merchandise sold in 20X4 was repossessed in 20X5 and the following entry was prepared

Deferred Gross Profit--20X4	2,200
Repossessed Merchandise Inventory	4,800
Loss on Repossessed Merchandise	3,000
Installment Accounts Receivable--20X4		10,000

REQUIRED: (1) What is the gross profit rate for 20X4? Show supporting computations.

(2) What is the gross profit rate for 20X5? Show supporting computations.

(3) Of the total cash receipts in 20X5, how much represents collections from installment sales for the following years. Show supporting computations.

(a) 20X3.

(b) 20X4.

(c) 20X5.

(4) What is the total realized gross profit in 20X5? Show supporting computations.

MAXWELL APPLIANCES

UNAJIUSTED TRIAL BALANCE

AT DECEMBER 31 20X5

	Debit	Credit
Cash	$ 48,000
Installment Accounts Receivable20X3	20,000
Installment Accounts Receivable20X4	50,000
Installment Accounts Receivable20X5	90,000
Inventory	25,200
Repossessed Merchandise Inventory	4,800
Accounts Payable		$ 34,600
Deferred Gross Profit--20X3		10,000
Deferred Gross Profit--20X4		26,400
Common Stock		125,000
Retained Earnings		10,000
Installment Sales		125,000
Cost of Installment Sales	80,000
Loss on Repossessed Merchandise	3,000
Operating Expenses	10,000
Totals	$ 331,000	$ 331,000