In the bathroom addition file, a contractor wants a 30 percent gross margin on a job with estimated cost of $77,000. What selling price gives that margin?
Correct Answer
B) $110,000.
Margin is profit divided by selling price. A 30 percent margin means cost is 70 percent of selling price, so $77,000 / 0.70 = $110,000.
Why This Is the Correct Answer
Margin is profit divided by selling price. A 30 percent margin means cost is 70 percent of selling price, so $77,000 / 0.70 = $110,000.
Why the Other Options Are Wrong
Option A: $100,100.
$100,100. is below the supported result for margin calculation; it likely uses the wrong base, period, or account bucket.
Option C: $115,500.
$115,500. is above the supported result for margin calculation; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $123,200.
$123,200. is above the supported result for margin calculation; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Coaching Estimator money shelf: cost for markup, price for margin.
Reference Hint
Study anchor (closed-book): memorize Margin calculation from CSLB Law and Business Study Guide; CSLB 2026 Law Book / CSLB Law and Business Study Guide Business Finances; know the rule or calculation trigger without relying on exam-room lookup.
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