A permit fee allowance is estimated at 1.1% of a $1,940,000 construction value. What allowance should be carried?
Correct Answer
D) $21,340
Multiply construction value by the fee allowance rate.
Why This Is the Correct Answer
Multiply construction value by the fee allowance rate.
Why the Other Options Are Wrong
Option A: $19,400
$19,400 is below the supported result for permit fee allowance; it likely omits part of the approved scope, cap, credit, or holdback.
Option B: $20,370
$20,370 is below the supported result for permit fee allowance; it likely omits part of the approved scope, cap, credit, or holdback.
Option C: $23,280
$23,280 is above the supported result for permit fee allowance; it likely adds scope or money the rule does not allow.
Memory Technique
Adds Permit-Fee contract math: approved scope is the ruler for permit.
Reference Hint
Open-book path: tab Principles and Practices of Commercial Construction, 11th Edition, 2024 to Preconstruction estimating; permit fee allowance; match the role, timing, and required approval before choosing.
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