A contractor receives a payment application from a subcontractor showing 60% completion on their $150,000 contract with 10% retainage. What amount should be paid?
Correct Answer
A) $81,000
Calculation: $150,000 × 60% = $90,000 earned. Less 10% retainage: $90,000 × 10% = $9,000. Net payment: $90,000 - $9,000 = $81,000.
Why This Is the Correct Answer
Calculation: $150,000 × 60% = $90,000 earned. Less 10% retainage: $90,000 × 10% = $9,000. Net payment: $90,000 - $9,000 = $81,000.
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