Reference no: EM132949258

Problem 1: The Bass Co. on September 30, 20x1, sold for 48,000 a piano costing 30,000. The down payment was 4,800 and an equal amount was to be paid at the end of each succeeding month. Monthly interest of 1% yield rate was to be charge on the unpaid balance of the installment contract, with payment applying first to accrued interest and the balance to principal. After paying a total of 19,200, the customer defaulted and the piano was correspondingly repossessed on February 28, 20x2, at which time basis. Bass Co. uses perpetual inventory system and records the total deferred gross profit at the time of sales. How much was the gain or loss on the repossession in 20x2.

a. 1,927

b. 1,867

c. 2,124

d. 1,678