Yr 1 Yr 2 Yr 3

Sales $200,000 $250,000 $300,000

COGS 160,000 150,000 210,000

Cash Collected

Year 1 Sales $140,000 $10,000 $40,000

Year 2 Sales ------------ $200,000 $30,000

Year 3 Sales ------------ ----------- $200,000

Required:

1. Calculate annual GP% (you need this)

2. Determine the Gross Profit recognized in each year from cash collected.

3. Determine the total Deferred Gross Profit at the end of year 3.