16. 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 month and pays the mortgage payment of $1,800. If the manager makes repairs to the property of $275, what will the owner receive this month
Answer: D
The owner will receive $2,425 this month.
To determine what the owner will receive, we first calculate the total rent collected for the six units, which is $750 multiplied by 6, totaling $4,500. After deducting the property manager's fee of 10% ($450), the mortgage payment of $1,800, and the repair costs of $275, the remaining amount for the owner is $2,425.
A) 1,700
Option A is incorrect because it underestimates the total amount the owner would receive. It does not account for the gross rents collected or the correct deductions for the property manager's fee, mortgage payment, and repairs.
B) 1,975
Option B is also incorrect as it fails to accurately reflect the calculations involving the gross rents and the necessary deductions. This option does not consider the full rental income or the appropriate deductions for the fees and expenses.
C) 3,775
Option C is incorrect because it overstates the amount the owner receives. This figure does not account for the property manager's fee, mortgage payment, or repair costs, leading to an inflated total.
D) 2,425
Option D is correct as it accurately represents the amount the owner will receive after subtracting the property manager's fee, the mortgage payment, and the cost of repairs from the total rent collected.
Conclusion
The correct answer is definitively $2,425, as it is derived from proper calculations of gross rents collected and the necessary deductions. Options A, B, and C fail to reflect the accurate financial outcomes after accounting for all costs associated with the management and upkeep of the rental units.