A property manager collects rent on 6 rental units for an owner. Each unit rents for $750 a month. The property manager charges the owner 10% of gross rents for the management fee, plus $275. What will the owner receive this month?

Rationale

The owner will receive $3,775 this month.

To calculate the amount the owner receives, we first determine the total rent collected from all units, subtract the property manager's fee, and then factor in the additional management charge.

A ($1,700) YOUR ANSWER

This amount represents a miscalculation of rent or fees. The total rent for 6 units at $750 each amounts to $4,500. Subtracting the management fee and additional charge would result in a much higher net income for the owner.

B ($1,975) YOUR ANSWER

This option suggests an incorrect total after management fees. The calculation for the management fee would be 10% of $4,500, which is $450, plus the additional $275, leading to a total fee of $725. This amount does not align with the correct net income.

C ($3,775) CORRECT

This is the accurate calculation. The total rent collected is $4,500. The management fee of 10% is $450, and the additional charge is $275. Subtracting both fees ($450 + $275 = $725) from $4,500 leaves the owner with $3,775.

D ($2,425) YOUR ANSWER

This figure seems to be a result of a miscalculation of the net amount after management fees. It does not reflect the correct subtraction of the property manager’s fees from the total rent collected, thus resulting in an inaccurately low net income for the owner.

Conclusion

The owner’s total amount received after the property manager's fees is calculated by first determining the gross rental income, then subtracting the management fee and fixed charge. After performing the calculations, it is evident that the owner will receive $3,775 this month, making choice C the correct answer. The other options arise from errors in these calculations.

A property manager collects rent on 6 rental units for an owner. Each unit rents for $750 a month. The property manager charges the owner 10% of gross rents for the management fee, plus $275. What will the owner receive this month?

The owner will receive $3,775 this month.

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