Calculate the payment and performance bond premium for a contract for a building project with an estimated cost of $12.5 million. Project duration is estimated at 18 months. If the project actual cost turns out to be $12.75m (same duration), what is the adjustment for the premium (how much extra should the contractor pay the surety)?
Details Given:
Estimated cost of building project: $12.5 million
Actual Cost of building: $12.75 million
Estimated Duration of project completion: 18 months
Actual completion of project: 18 months
Working:
Particulars | Amount |
Estimated Cost (A) | $12.50 |
Actual Cost (B) | $12.75 |
Balance (C = B - A) | $0.25 |
Since the period of estimation of project completion and actual completion of project is same i.e. 18 months, the contractor has to pay $0.25 million extra.
Get Answers For Free
Most questions answered within 1 hours.