Ulrich CoSells an Asset to a Buyer for a Total Sales

question 103

Multiple Choice

Ulrich Co.sells an asset to a buyer for a total sales price of $6,000 with a payment schedule of $2,000 in year 1, $2,000 in year 2, and $2,000 in year 3.The cost of the asset is $5,000.Under the cost-recovery-first method, what amount of net profit is recognized in year 3?

• A)$2,000
• B)$1,000
• C)$666.67
• D)$333.33
• E)$0

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