Question

What are the characteristics of progress payments?

a. Cash receipts only occur once during each month b. Defer paying some of the costs until it receives payment from owner c. Owner holds back part of the payments as retention d. All of the above.

Answer 1

Ans: All of the above.

Explanation:

The concept of progress payment is used in construction business. It is a partial payment that covers the amount of work that has been completed up to the point of invoicing. The progress payment has three unique characteristics:

• Cash receipts only occur once during each month
• Defer paying some of the costs until it receives payment from owner
• Owner holds back part of the payments as retention

Thus, option [d] is correct answer.