A premium allocation uses $32,000 annual premium and a job representing 6 percent of annual revenue. What cost is allocated?
Correct Answer
B) $1,920.
The allocated cost is $32,000 x 6 percent = $1,920.
Why This Is the Correct Answer
The allocated cost is $32,000 x 6 percent = $1,920.
Why the Other Options Are Wrong
Option A: $1,600.
$1,600. is below the supported result for insurance allocation calculation; it likely skips a premium-pay or employer-cost component.
Option C: $2,600.
$2,600. is above the supported result for insurance allocation calculation; it likely pays the wrong premium tier or counts the same hours twice.
Option D: $3,200.
$3,200. is above the supported result for insurance allocation calculation; it likely pays the wrong premium tier or counts the same hours twice.
Memory Technique
Allocating Overhead payroll: time, premium, reimbursement, proof in separate buckets.
Reference Hint
Study anchor (closed-book): memorize Insurance allocation calculation from CSLB 2026 Law Book; CSLB workers' compensation guidance; California. / CSLB Law Book insurance and business finance study concepts; know the rule or calculation trigger without relying on exam-room lookup.
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