A general contractor in Raleigh has 12 employees working on a commercial building project. The total weekly payroll is $18,500. If the workers compensation rate is $12.75 per $100 of payroll for this type of work, what is the weekly premium?
Correct Answer
A) $2,358.75
Weekly premium = ($18,500 ÷ $100) × $12.75 = 185 × $12.75 = $2,358.75
Why This Is the Correct Answer
Workers' comp premium = (Payroll ÷ 100) × Rate. Step 1: $18,500 ÷ 100 = 185 units. Step 2: 185 × $12.75 = $2,358.75. The number of employees (12) is not used in this calculation — it is a distractor.
Why the Other Options Are Wrong
Option B: $2,258.75
$2,258.75 is $100 less than the correct answer, likely resulting from a subtraction error or using $12.75 × 177 instead of 185 (misreading payroll as $17,700).
Option C: $2,058.75
$2,058.75 is $300 less than the correct answer, possibly from computing 185 × $11.13 or from a larger payroll misread. Does not match any straightforward calculation of the given inputs.
Option D: $2,158.75
$2,158.75 is $200 less than the correct answer. Could result from using a rate of ~$11.67 per $100 or from a payroll figure of $16,931. Does not reflect the problem's numbers correctly.
Memory Technique
Workers' comp formula: Payroll ÷ 100, then × Rate. Think of it as '$X per hundred dollars earned.' Always divide first, multiply second. The employee count is just scenery — ignore it.
More North Carolina Questions
A residential contractor in NC wants to bid on a $125,000 project but currently holds an Intermediate license. What action must be taken?
A contractor discovers contaminated soil during excavation on a commercial project in Charlotte. Under NC environmental regulations, what is the first required action?
A North Carolina contractor completes a $45,000 residential addition project. The homeowner refuses to pay the final $8,000. What is the filing deadline for a mechanic's lien under NC lien law?
A residential contractor in Charlotte is building a deck addition. Which inspection is typically required first under NC building codes?
A contractor performs work on a residential property in North Carolina but is not paid. The work was completed on March 15th, and the last material was delivered on March 20th. What is the deadline to file a claim of lien?
A subcontractor performing electrical work discovers that the general contractor's license has been suspended. What action should the subcontractor take according to NC General Statutes?
A contractor in North Carolina discovers contaminated soil during excavation. The soil contains petroleum products above reportable levels. Which agency must be notified immediately?
A contractor performing work on a North Carolina highway project encounters a suspected archaeological artifact. What is the required action under NC environmental regulations?
Calculate the workers' compensation premium for a NC roofing contractor with $250,000 in annual payroll and a rate of $18.50 per $100 of payroll:
Calculate the lien amount a subcontractor can claim on a $180,000 project where they provided $35,000 in materials and labor, but the general contractor still owes them $12,000:
People Also Study
Business & Financial Management
120 questions · 70% to pass
Contract Administration
60 questions · 70% to pass
Project Management
60 questions · 70% to pass
Related Study Resources
Previous Question
A North Carolina contractor fails to pay subcontractors $45,000 on a residential project. Under NC lien law, what is the maximum time period after substantial completion that a subcontractor has to file a claim of lien on real property?
Next Question
A North Carolina contractor completes a $45,000 residential addition project. The homeowner refuses to pay the final $8,000. What is the filing deadline for a mechanic's lien under NC lien law?