Payroll subject to a supplied workers' compensation rate is $210,000. If the rate is 5.5 percent, what premium estimate should be budgeted?
Correct Answer
A) $11,550.
The premium estimate is $210,000 x 5.5 percent = $11,550.
Why This Is the Correct Answer
The premium estimate is $210,000 x 5.5 percent = $11,550.
Why the Other Options Are Wrong
Option B: $10,500.
$10,500. is below the supported result for workers compensation cost calculation; it likely skips a premium-pay or employer-cost component.
Option C: $12,750.
$12,750. is above the supported result for workers compensation cost calculation; it likely pays the wrong premium tier or counts the same hours twice.
Option D: $21,000.
$21,000. is above the supported result for workers compensation cost calculation; it likely pays the wrong premium tier or counts the same hours twice.
Memory Technique
Who controlled premium, who paid estimate, where is the Budgeting Insurance record?
Reference Hint
Study anchor (closed-book): memorize Workers compensation cost calculation from CSLB Law and Business Study Guide; California Employment Development. / California Labor Code workers compensation cost concepts; know the rule or calculation trigger without relying on exam-room lookup.
More Law & Business Questions
A Fresno homeowner wants a $725 cabinet repair and trim adjustment. Which contract step best matches CA home improvement requirements?
A project has $6,500 retainage withheld. The owner releases 60 percent of retainage at substantial completion. How much cash is released?
Cash is $52,500 and monthly burn is $17,500. How many months of runway are available?
A supplier offers 1.5 percent early-pay discount on a $22,000 invoice. What is the discount?
A balance sheet lists assets of $310,000 and liabilities of $185,000. What is owner's equity?
A job is estimated to cost $135,000. What price gives a 25 percent gross margin?
A customer invoice of $4,000 has a stated late charge of 1.5 percent. What late charge is added?
A bid has direct labor of $18,000, materials of $12,500, and equipment rental of $3,500. If the contractor adds 20 percent markup on direct cost, what is the bid price?
A contractor wants a 25 percent gross margin on a job with estimated cost of $60,000. What selling price gives that margin?
A completed project sold for $150,000 and had total cost of $126,000. What gross margin percentage did the project earn?