5-29 Custom Homebuilders (CH) designs and constructs high-end homes on large lots owned by customers....
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Accounting
5-29
Custom Homebuilders (CH) designs and constructs high-end homes on large lots owned by customers. CH has developed several formulas, which it uses to quote jobs. These include costs for materials, labor, and other costs. These estimates are also dependent on the region of the country a particular customer lives. The following are the cost estimates for one region in the Midwest.
Administrative costs
$
36,000
Building costs per square foot (basic)
$
100
Building costs per square foot (moderate)
$
180
Building costs per square foot (luxury)
$
240
Appliances (basic)
$
31,000
Appliances (moderate)
$
41,000
Appliances (luxury)
$
61,000
Utilities costs (if required)
$
56,000
Required:
A customer has expressed interest in having CH build a moderate, 4,600 square-foot home on a vacant lot, which does not have utilities. Based on the engineering estimates above, what will such a house cost to build?
a. administrative cost?
b. building cost?
c. appliance cost?
d. utilities cost?
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