A Michigan contractor has $85,000 in labor costs and $45,000 in material costs for a project. If the workers compensation rate is 8.5% of labor costs, what is the total workers compensation premium?
Correct Answer
C) $7,225
Workers compensation is calculated only on labor costs: $85,000 × 8.5% = $7,225. Material costs are not included in the calculation.
Why This Is the Correct Answer
Workers compensation is calculated only on labor costs: $85,000 × 8.5% = $7,225. Material costs are not included in the calculation.
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