Ponderosa Development Corporation (PDC) is a small real estate developer that builds only one style of house. The selling price of the house is $115,000. Land for each house costs $55,000 and lumber, supplies and other materials run another $28,000 per house. Total labor costs are approximately $20,000 per house. Ponderosa leases office space for $2000 per month. The cost of office supplies, utilities and leased equipment runs another $3000 per month. The one sales person of PDC is paid a commission of $2000 on the sale of each house. PDC has a seven permanent employees whose monthly salaries is given below

Ponderosa Development Corporation (PDC) is a small real estate developer that builds only one style of house. The selling price of the house is $115,000. Land for each house costs $55,000 and lumber, supplies and other materials run another $28,000 per house. Total labor costs are approximately $20,000 per house. Ponderosa leases office space for $2000 per month. The cost of office supplies, utilities and leased equipment runs another $3000 per month. The one sales person of PDC is paid a commission of $2000 on the sale of each house. PDC has a seven permanent employees whose monthly salaries is given below

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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A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

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