Coonabarabran Realty Bought a 2000-Hectare Island for $10 000 000

Essay

Coonabarabran Realty bought a 2000-hectare island for $10 000 000 and divided it into 200 equal size lots.
As the lots are sold,they are cleared at an average cost of $5000.
Storm drains and driveways are installed at an average cost of $8000 per site.
Sales commissions are 10% of selling price.
Administrative costs are $850 000 per year.
The average selling price was $160 000 per lot during 2017 when 50 lots were sold.
During 2018,the company bought another 2000-hectare island for $10 000 000 and developed it exactly the same way.Lot sales in 2018 totalled 300 with an average selling price of $160 000.All costs were the same as in 2017.
Required:
Prepare income statements for both years using both absorption and variable costing methods.
_____________________________________________________________________________________________
_____________________________________________________________________________________________