Installment sales is a term used to describe a sale which is done on a deferred payment option. This is most apparent in real estate business where the builders and developers transfer the apartments or flats over a number of periods by taking monthly, quarterly and yearly payments.
In the electronics industry, the dealers also sell the electronics items on installment sales method. So, there is a huge volume of transactions in the industry. Here comes the role of Accounting for Installment Sales.
In the installment sale, the buyer gets the ownership of the asset by making the small amount of down payment. Later, he or she needs to pay the periodic equal amount of fees to pay off the remaining liabilities.