A contractor's job estimate includes $40,000 materials, $35,000 labor, and $25,000 subcontractors. The contractor adds 16% overhead and then 12% profit on the overhead-loaded cost. What is the bid price (rounded to the nearest dollar)?
a.$100,000
b.$116,000
c.$129,920
d.$112,000
Explanation
Direct costs = $40,000 + $35,000 + $25,000 = $100,000. With overhead: $100,000 × 1.16 = $116,000. With profit: $116,000 × 1.12 = $129,920.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)