Phil Collins Realty Corporation purchased a tract of unimproved land for $53,000
ID: 2450489 • Letter: P
Question
Phil Collins Realty Corporation purchased a tract of unimproved land for $53,000. This land was improved and subdivided into building lots at an additional cost of $28,000. These building lots were all of the same size but owing to differences in location were offered for sale at different prices as follows.
Group
No. of Lots
Price per Lot
Operating expenses for the year allocated to this project total $15,300. Lots unsold at the year-end were as follows.
At the end of the fiscal year Phil Collins Realty Corporation instructs you to arrive at the net income realized on this operation to date. (Round ratios for computational purposes to 4 decimal places, e.g. 78.7234% and final answer to 0 decimal places, e.g. 5,845.)
$
Group
No. of Lots
Price per Lot
1 8 $3,150 2 18 4,200 3 21 2,100Explanation / Answer
Answer:
Notes:
Calculation of net Income In$ Sales 102900 Cost of goods sold 57522 Gross Profit 45378 Operating Expenses 15300 Net Income 30078