A project has a contract value of $2,500,000 with 10% retainage held until 50% completion, then reduced to 5%. If the project is 75% complete, what is the total amount of retainage being held?
Correct Answer
A) $156,250
At 50% completion: $1,250,000 × 10% = $125,000 retainage. From 50% to 75%: additional $625,000 × 5% = $31,250. Total retainage: $125,000 + $31,250 = $156,250.
Why This Is the Correct Answer
At 50% completion: $1,250,000 × 10% = $125,000 retainage. From 50% to 75%: additional $625,000 × 5% = $31,250. Total retainage: $125,000 + $31,250 = $156,250.
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