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(Relative Sales Value Method) Phil Collins Realty Corporation purchased a tract of unimproved land for

$55,000

. This land was improved and subdivided into building lots at an additional cost of

$34,460

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

1

9

$3,000

2

15

$4,000

3

17

$2,400

Operating expenses for the year allocated to this project total

$18,200

Lots unsold at the year-end

as follows:

Group

No. of Lots

1

5

2

7

3

2

Instructions:

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.

Group

No. of lots

Sales price per lot

Total sales price

Relative sales price as %

Cost total

Cost allocated to lots

Cost per lot

1

Number

Amount

Amount

Formula

Amount

Formula

Formula

2

Number

Amount

Amount

Formula

Amount

Formula

Formula

3

Number

Amount

Amount

Formula

Amount

Formula

Formula

Formula

Formula

Formula

Lots Sold

Group

No. of Lots

Price per lot

Total selling price

Cost per lot

Extended cost

Gross Profit

1

Number

Amount

Formula

Amount

Formula

Formula

2

Number

Amount

Formula

Amount

Formula

Formula

3

Number

Amount

Formula

Amount

Formula

Formula

Formula

Formula

Formula

Formula

Sales (see schedule)

Amount

Cost of goods sold (see schedule)

Amount

Gross profit

Formula

Operating expenses

Amount

Net income

Formula

Answer & Explanation Solved by verified expert

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