Victor, a project manager, is constructing a budget for a project to construct a house. He estimates that the materials will cost $100,000 and the project will require 15 people working 6 hours a day to ensure timely completion. He estimates the cost of labor at $15 per hour. Additional costs, safety equipment, and overheads are marked at a rate of 50 percent of direct labor. In this scenario, the total cost of the project will be _____.
A) $120,000
B) $102,025
C) $100,090
D) $100,900
E) $110,510

Question

Quizplus · Accepted Answer

The total cost of the project is the sum of the cost of materials, labor, and additional costs. The cost of materials is $100,000. The cost of labor is 15 people * 6 hours/day * $15/hour * 15 days = $100,900. The additional costs are 50% of the direct labor cost, which is $100,900 * 0.50 = $50,450. Therefore, the total cost of the project is $100,000 + $100,900 + $50,450 = $251,350.

Victor, a Project Manager, Is Constructing a Budget for a Project