South Carolina Contractor License Exam — All Questions

A South Carolina job costs $90,000, and the contractor targets a 25% margin on the selling price. What is the correct bid?

• a.$112,500
• b.$120,000✓
• c.$108,000
• d.$72,000

For a target margin, divide cost by (1 - margin): $90,000 / (1 - 0.25) = $90,000 / 0.75 = $120,000. Multiplying cost by 1.25 gives $112,500, which is only a 20% margin - the classic markup-vs-margin trap.Margin: price = cost / (1 - margin)

A contractor's overhead runs 15% of direct job cost. On a job with $40,000 of direct cost, what is the total cost (direct cost plus allocated overhead) before profit?

• a.$46,000✓
• b.$40,000
• c.$6,000
• d.$54,000

Overhead to allocate = 15% x $40,000 = $6,000. Total cost = direct cost + overhead = $40,000 + $6,000 = $46,000, before any profit is added. Profit is then figured on top of this total cost.Estimating (overhead allocation as a percentage of direct cost)

An estimator prices framing at $6.50 per square foot for a 2,400-square-foot house. What is the framing estimate?

• a.$9,600
• b.$16,500
• c.$14,400
• d.$15,600✓

Unit-cost estimate = unit price x quantity = $6.50 x 2,400 sq ft = $15,600. The unit-cost method multiplies a known cost per unit by the measured quantity from the takeoff.Estimating (unit-cost method)