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12-02-2011, 04:11 PM
I think there is something not right with your calculation.
for point 2, assume total project sales would be 700 mil. land cost 361 mil, construction cost 95 mil. It seems that you left out interest cost (loan took for developmentof Laurels) they need recoganize for development cost, which will form part of cost of goods sold (hope I am not wrong). for markting and showflat, they already expensed most of them, how about sales commission or other sale related charge? how about the administritive and other operating expense they will incur for the construction period of the Laurels? are you assuming that they will not incur any expense for 2011 - 2012 if there is no new development? profit before tax = gross profit?
I think the recoganizable profit from the Laurels should be around 100 mil instead of 150 mil.
for point 2, assume total project sales would be 700 mil. land cost 361 mil, construction cost 95 mil. It seems that you left out interest cost (loan took for developmentof Laurels) they need recoganize for development cost, which will form part of cost of goods sold (hope I am not wrong). for markting and showflat, they already expensed most of them, how about sales commission or other sale related charge? how about the administritive and other operating expense they will incur for the construction period of the Laurels? are you assuming that they will not incur any expense for 2011 - 2012 if there is no new development? profit before tax = gross profit?
I think the recoganizable profit from the Laurels should be around 100 mil instead of 150 mil.