Alternate No. 2 removes a scope item with $38,000 direct cost. The bid form requires overhead and profit at 10% on alternates. What deductive alternate amount should be listed?
Correct Answer
C) $41,800 deduct
The alternate deduct includes direct cost plus the required overhead and profit.
Why This Is the Correct Answer
The alternate deduct includes direct cost plus the required overhead and profit.
Why the Other Options Are Wrong
Option A: $34,200 deduct
$34,200 deduct is below the supported result for deductive alternate; it likely uses the wrong base, period, or account bucket.
Option B: $38,000 deduct
$38,000 deduct is below the supported result for deductive alternate; it likely uses the wrong base, period, or account bucket.
Option D: $45,600 deduct
$45,600 deduct is above the supported result for deductive alternate; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Estimator Fills money test: bucket before math for deductive.
Reference Hint
Open-book path: tab Principles and Practices of Commercial Construction, 11th Edition, 2024 to Bid alternates and bid-form pricing; match the project role and timing before choosing.
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