Question
Larsen Realty Corporation purchased a tract of unimproved land for $51,000. This land was improved and subdivided into building lots at an additional cost of
Larsen Realty Corporation purchased a tract of unimproved land for $51,000. 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 follow.
Group | No. of Lots | Price per Lot | ||
1 | 8 | $4,950 | ||
2 | 15 | 6,600 | ||
3 | 21 | 3,300 |
Operating expenses for the year allocated to this project total $15,700. Lots unsold at the year-end were as follows.
Group 1 | 4 lots | |
Group 2 | 6 lots | |
Group 3 | 2 lots |
At the end of the fiscal year Larsen Realty Corporation instructs you to arrive at the net income realized on this operation to date. (Round ratios for computational purposes to 1 decimal place, e.g 78.7% and final answers to 0 decimal places, e.g. $5,845.)
I keep getting stuck on this, I'm not sure what I am doing wrong. I answers keep ranging in the 25000 area. Any assistance is greatly appreciated
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