Calculate the lien amount a subcontractor can claim under NC lien law for a project where they were contracted for $28,000, completed $24,500 worth of work, and were paid $18,000:
Correct Answer
A) $6,500
The lien amount is limited to the value of work performed minus payments received: $24,500 - $18,000 = $6,500.
Why This Is the Correct Answer
Under NC lien law, the lien amount is limited to the value of work actually performed minus any payments already received. The subcontractor completed $24,500 in work and received $18,000, leaving $6,500 unpaid. The original contract amount ($28,000) is irrelevant because the work was not fully completed. The lien secures only the unpaid balance for work actually furnished.
Why the Other Options Are Wrong
Option B: $28,000
$28,000 represents the total contract amount, not the amount earned. Because the subcontractor did not complete all contracted work, the full contract price cannot be liened — only the value of work actually performed.
Option C: $24,500
$24,500 represents the value of work performed, but ignores the $18,000 already paid. A lien cannot exceed the amount still owed; claiming $24,500 would result in double recovery for the portion already paid.
Option D: $10,000
$10,000 does not correspond to any correct calculation in this scenario. It appears to be a distractor with no mathematical basis from the given figures.
Memory Technique
Lien amount = Work Done minus Paid. Always two steps: (1) How much work was completed? (2) How much has already been paid? Subtract step 2 from step 1. Never use the total contract value unless 100% complete.
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A residential contractor in NC wants to bid on a $125,000 project but currently holds an Intermediate license. What action must be taken?
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