Larsen 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 $30,000.These building lots were all of the same size but owing to differences in location were offered for sale at different prices as follows. Operating expenses allocated to this project total $18,200.Group123No. ofLots91519Group # of lots91215319Instructions: Using the charts below calculate the net income realized on this operation to date.Relative Sales Value Chart - Cost per LotGroup Lots Sold123Priceper Lot$ 3,0004,0002,000AccountPricePer Lot$3,0004,0002,000SalesCost of Goods SoldGross ProfitOperating ExpensesNet IncomeRelative Sales Value Chart - Cost of Goods Sold AllocationSelling PricePer LotLots Unsoldat Year-End572$3,0004,000TotalRevenueRelative Sales Value Chart - Net Income CalculationAmountTotal SalesRelative SalesPriceCost per LotTotalCostCostAllocatedper GroupTotal Cost ofGoods SoldCostAllocatedper Lot

It is the income earned by an entity after incurring all the expenses. It is the net revenue left…

Larsen 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 $30,000. These building lots were all of the same size but owing to differences in location were offered for sale at different prices as follows. Operating expenses allocated to this project total $18,200. Group 1 2 3 No. of Lots 9 15 19 Price per Lot $3,000 4,000 2,000 Lots Unsold at Year-End 5 7 2

Larsen 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 $30,000. These building lots were all of the same size but owing to differences in location were offered for sale at different prices as follows. Operating expenses allocated to this project total $18,200. Group 1 2 3 No. of Lots 9 15 19 Price per Lot $3,000 4,000 2,000 Lots Unsold at Year-End 5 7 2

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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