Question 26

The owner will receive $1,975 this month.

To determine the amount the owner receives this month, we must first calculate the total gross rent collected, deduct the property manager's fee, and account for the mortgage payment and repair costs.

A) $1,700

This option is incorrect because it does not accurately account for the total gross rent collected or the deductions for the property manager's fee, mortgage payment, and repair costs. The calculations leading to this figure overlook these essential components.

B) $1,975

This option is correct as it includes the correct calculations: the total rent collected from the 8 units is $2,200 ($275 per unit x 8 units). The property manager's fee is 10% of that amount, which is $220. After deducting the mortgage payment of $1,800 and the repair cost of $275, the owner receives $1,975 ($2,200 - $220 - $1,800 - $275).

C) $3,775

This option is incorrect because it represents a total that does not consider the deductions for the property manager's fee, mortgage payment, and repair costs. It appears to misunderstand the calculations necessary for determining the owner's net income.

D) $2,425

This option is incorrect as it miscalculates the total amount the owner would receive. It fails to properly account for the property manager's fee and the expenses incurred, leading to an inflated figure that does not reflect the actual net income for the month.

Conclusion

The correct answer is $1,975, as it accurately reflects the total gross rents collected, properly deducts the property manager's fee, mortgage payment, and costs for repairs. All other options fail to follow the necessary calculations for determining the owner's net income after expenses, leading to incorrect figures.