Questions: 1. What amount should be allocated as total cost of Class B lots under the relative sales price method? a. 1,176,000 b. 1,220,000 c. 1,276,000 d. 1,700,000 2. If Elixir Company was able to sell all the lots except for 15 lots of Class C, how much is the cost of sales to be recognized for the year?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Questions: 1. What amount should be allocated as total cost of Class B lots under the relative sales price method? a. 1,176,000 b. 1,220,000 c. 1,276,000 d. 1,700,000 2. If Elixir Company was able to sell all the lots except for 15 lots of Class C, how much is the cost of sales to be recognized for the year?
Elixir Company bought a 10-hectares land in Novaliches to be improved, subdivided into lots
and eventually sold. The purchase price of the land was P5,800,000.
Taxes and documentation expenses on the transfer of the property amounted to P80,000.
Lot class
Number of lots
Selling price per lot Total clearing cost
None
100,000
80,000
10
20
100,000
300,000
800,000
40
70,000
50
60,000
ABCD
Transcribed Image Text:Elixir Company bought a 10-hectares land in Novaliches to be improved, subdivided into lots and eventually sold. The purchase price of the land was P5,800,000. Taxes and documentation expenses on the transfer of the property amounted to P80,000. Lot class Number of lots Selling price per lot Total clearing cost None 100,000 80,000 10 20 100,000 300,000 800,000 40 70,000 50 60,000 ABCD
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