A contractor receives a stop work order from OSHA for fall protection violations. The project has a daily overhead cost of $2,800. If the stop work order lasts 5 days, what is the total overhead cost impact?
Correct Answer
C) $14,000
Total overhead cost = Daily overhead × Number of days = $2,800 × 5 days = $14,000. Stop work orders can result in significant financial impact due to continued overhead costs while work is halted.
Why This Is the Correct Answer
The correct answer is C) $14,000 because overhead costs continue to accumulate even when work is stopped due to regulatory violations. The calculation is straightforward: $2,800 daily overhead × 5 days = $14,000. This represents the total financial impact of overhead costs during the work stoppage period. Stop work orders don't eliminate overhead expenses like equipment rentals, supervision salaries, or site security costs.
Why the Other Options Are Wrong
Option A: $2,800
Option B ($11,200) appears to be calculated using 4 days instead of the specified 5 days ($2,800 × 4 = $11,200). This miscalculation underestimates the total overhead cost impact by one full day.
Option B: $16,800
Option A only represents one day's overhead cost ($2,800) and fails to account for the full 5-day duration of the stop work order. This significantly underestimates the financial impact of the work stoppage.
Option D: $11,200
Option D ($16,800) overestimates the cost by calculating 6 days instead of the specified 5 days ($2,800 × 6 = $16,800). This adds an extra day that wasn't part of the stop work order duration.
Memory Technique
Remember 'Daily × Days = Damage' - the financial damage from stop work orders equals daily overhead multiplied by the number of stopped days.
Reference Hint
Florida Building Code Chapter 1, Section 114 - Stop Work Orders, and construction project management sections covering overhead cost calculations
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