Question
Franklin Condos Corporation is a small company owned by Dennis Hatch. It leases three condos of different sizes to customers as vacation facilities. Labor costs
Franklin Condos Corporation is a small company owned by Dennis Hatch. It leases three condos of different sizes to customers as vacation facilities. Labor costs for each condo consist of maid service and maintenance cost. Other direct operating costs consist of interest and depreciation. The direct operating costs for each condo follow.
Condo 1: Direct Labor $16,700 Other Direct Operating Costs $ 39,800
Condo 2: Direct Labor $18,400 Other Direct Operating Costs $ 44,000
Condo 3: Direct Labor $29,750 Other Direct Operating Costs $ 60,000
Total of Direct Labor $64,850 Other Direct Operating Costs $143,800
Indirect operating expenses, which amounted to $ 43,140, are allocated to the condos in proportion to the amount of other direct operating costs incurred for each.
Required:
a. Assuming that the amount of rent revenue from Condo 2 is $ 114,000, what amount of income did it earn? (Do not round intermediate calculations.)
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