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Discussion Starter · #1 ·
Sample question from the California State Contractors Board test:

What would you bid for a new project with direct costs of $22,500 and you need to include a 5% profit and 15% overhead?

A. $28,125
B. $27,000
C. $25,500
D. None of the above

Answer A

Please provide what formula they used
 

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Answer A is correct. You will get the 5 and 15 (20%) over costs.

It is 20% of the final price not 20% of the job costs.

20% of $28,125.00 is $5,625.00 which is the differance between the $28,125.00 and the $22,500.00.

$22,500.00 plus the $5,625.00 gives an amount of $28,125.00. This way you get 20% of the final price.
 

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Discussion Starter · #4 ·
OK Help Here

Direct costs are $7,200, overhead is 12%, and profit is 10%. What is the selling price?

A. $7,389.50
B. $8,326.28
C. $9,132.37
D. $9,230.77

Answer D

Again, please show your formula. Thanks!
 
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