A masonry crew can install 120 square feet of block wall per day. If the crew costs $850 per day and overhead/profit adds 25%, what is the cost per square foot installed?
Correct Answer
C) $8.85
Base cost per sq ft: $850 ÷ 120 = $7.08. With 25% overhead/profit: $7.08 × 1.25 = $8.85 per square foot.
Why This Is the Correct Answer
The correct answer is B ($8.85) because it properly calculates the base cost per square foot first ($850 ÷ 120 sq ft = $7.08), then applies the 25% overhead and profit markup. The markup is calculated by multiplying the base cost by 1.25 (which represents 100% + 25% = 125%). This gives us $7.08 × 1.25 = $8.85 per square foot installed.
Why the Other Options Are Wrong
Option B: $9.25
Option D ($10.63) represents an excessive markup that would be approximately 50% rather than the specified 25% overhead and profit.
Option D: $7.08
Option A ($7.08) only represents the base cost per square foot without the required 25% overhead and profit markup applied.
Memory Technique
Remember 'Base × 1.25' - the '1' represents your original cost (100%) and the '.25' represents the additional 25% markup.
Reference Hint
Look up cost estimating and markup calculations in Chapter 9 (Project Management) or the construction cost estimation sections of your reference materials.
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