Safe Haven Company sells merchandise on regular terms (cash or 30-day open accounts) as well as the installment plan and uses the periodic inventory system. The installment method of accounting is used to record the installment sales. Gross profit rate on installment sales is 32% for 2009 and 30% for 2010. Interest and carrying charges are not included in the computation of gross profit on installment sales.

The following account balances were found in the post-closing trial balance prepared on January 1, 2011.

Deferred Interest and Carrying Charges $ 10,220

Installment Contract Receivable 2009. $ 20,020

Installment Contract Receivable 2010. $ 29,400

Deferred Gross Profit 2009 Installment Sales $ 5,824

Deferred Gross Profit 2010 Installment Sales $ 25,200

In addition, the information on the cash collections during the year 2011 concerning interest and carrying charges are available as follows.

Installment Contract Receivable	Interest and Carrying Charges
2009 2010 2011	$ 1,610 7,560 17,500

Furthermore, the following account balance are extracted from a trial balance prepared for the Safe Haven Company on December 31, 2011.

Installment Contract Receivable 2009 $ 2,310

Installment Contract Receivable 2010 9,240

Installment Contract Receivable 2011 42,000

Deferred Interest and Carrying Charges 31,220

Deferred Gross Profit 2009 installment Sales 5,824

Deferred Gross Profit 2010 installment Sales 25,200

Installment Sales 224,000

Shipment on Installment Sales 168,000

However, the revenue from Interest Charges Account, Deferred Gross Profit 2011 Installment Sales and Realized Gross Profit on Installment Sales account are not in the December 31, 2011 Trial Balances.

Instructions:

Prepare journal entries including the adjusting journal entries for Safe Haven Company on December 31, 2011.