Which cost method involves dividing total management costs by the number of units managed?

The correct answer is the Per-Unit Cost Method, which involves calculating management costs on a per unit basis. This method allows property managers to determine the cost associated with managing each individual unit by taking the total management costs and dividing that number by the total number of units being managed. This is particularly useful in property management as it helps owners and managers assess the efficiency and effectiveness of their management practices, providing a clear insight into how much each unit contributes to or incurs from management expenses.

This method is especially advantageous for budget planning and resource allocation, enabling property managers to identify which units are more costly to manage and if various units contribute similarly to total management expenses. By understanding these costs on a per-unit basis, property managers can make informed decisions regarding pricing strategies, operational changes, and capital improvements to optimize their management processes and profitability.