A project has $6,500 retainage withheld. The owner releases 60 percent of retainage at substantial completion. How much cash is released?
Correct Answer
D) $3,900.
Sixty percent of $6,500 is $3,900.
Why This Is the Correct Answer
Sixty percent of $6,500 is $3,900.
Why the Other Options Are Wrong
Option A: $10,833.
$10,833 divides by 0.6 instead of multiplying. The correct calculation is 6,500 x 0.60 = 3,900.
Option B: $39,000.
$39,000 misplaces the decimal point, giving ten times the correct amount. The correct calculation is 6,500 x 0.60 = 3,900.
Option C: $390.
$390 misplaces the decimal point, giving one tenth of the correct amount. The correct calculation is 6,500 x 0.60 = 3,900.
Reference Hint
Study anchor (closed-book): memorize Retention release 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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