Question - Heart & Home Properties is developing a subdivision that includes 430 home lots. The 190 lots in the Canyon section are below a ridge and do not have views of the neighboring canyons and hills; the 240 lots in the Hilltop section offer unobstructed views. The expected selling price for each Canyon lot is $50,000 and for each Hilltop lot is $95,000. The developer acquired the land for $2,100,000 and spent another $2,200,000 on street and utilities improvements.
Assign the joint land and improvement costs to the lots using the value basis of allocation and determine the average cost per lot.