Assume a retail tenant is paying a base rent of $120,000 per year (or $10,000 per month). In addition, the tenant must pay 7 percent of gross store sales in excess of $143,000 per month as percentage rent. If the store produces $170,000 in gross sales in a month, what is the total rent due for the month?

Question

Quizplus · Accepted Answer

The base rent is $10,000. The percentage rent is 7% of sales over $143,000. The excess sales are $170,000 - $143,000 = $27,000. The percentage rent is 7% of $27,000, which is $1,890. Therefore, the total rent is $10,000 + $1,890 = $11,890.

Assume a Retail Tenant Is Paying a Base Rent of $120,000