A long-lead equipment vendor requires a 30% deposit on a $74,000 package. What cash requirement should be forecast?
Correct Answer
A) $22,200
Multiply package price by the deposit percentage.
Why This Is the Correct Answer
Multiply package price by the deposit percentage.
Why the Other Options Are Wrong
Option B: $18,500
$18,500 is below the supported result for early procurement deposit; it likely uses the wrong base, period, or account bucket.
Option C: $24,700
$24,700 is above the supported result for early procurement deposit; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $29,600
$29,600 is above the supported result for early procurement deposit; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Schedules Mechanical money test: bucket before math for early procurement.
Reference Hint
Open-book path: tab Principles and Practices of Commercial Construction, 11th Edition, 2024 to Procurement planning; deposits and cash-flow forecast; match the role, timing, and required approval before choosing.
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