A Palm Springs startup bids a project at $94,500 with estimated cost of $75,600. What gross profit dollars should the owner expect?
Correct Answer
B) $18,900
Gross profit dollars equal bid price less estimated cost.
Why This Is the Correct Answer
Gross profit dollars equal bid price less estimated cost.
Why the Other Options Are Wrong
Option A: $170,100 business audit note
$170,100 business audit note is above the supported result for startup pricing control; it likely adds an unsupported amount or compares the wrong financial base.
Option C: $75,600 insurance evidence file
$75,600 insurance evidence file is above the supported result for startup pricing control; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $9,450 banking setup log
$9,450 banking setup log is below the supported result for startup pricing control; it likely uses the wrong base, period, or account bucket.
Memory Technique
Startup Pricing drawer for Owner Reviews: label gross before counting dollars.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Builder's Guide to Accounting, Gross profit and pricing; verify the startup duty, registration, or financial setup before answering.
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