Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem 1: Conduct cash flow analysis for the construction project shown in the table below: Project info: The indirect cost per month of the project
Problem 1: Conduct cash flow analysis for the construction project shown in the table below: Project info: The indirect cost per month of the project is $ 3000 for the first 50% of the project total duration and $4500 per month for the remaining duration. The retainage is 10%. The markup is 20% of the total cost. Progress payments will be billed at the end of the month, and the owner will transfer the billed amount minus any retainage to the contractor's account 30 days later (1 month later). Investigate the following: If the received payment is less than the expected contractor's revenue, how much should the contractor have as a line of credit to maintain the continuity in the construction of the project? Assume 2% of interest is applied. How much reduction in the profit expected due to the interest paid to the borrowing agency? Activity Preceded by Direct cost A B C Normal duration (month) 3 6 6 A A A 6000 24000 6000 0 4000 1600 8 2 B.C E F D 4 Problem 1: Conduct cash flow analysis for the construction project shown in the table below: Project info: The indirect cost per month of the project is $ 3000 for the first 50% of the project total duration and $4500 per month for the remaining duration. The retainage is 10%. The markup is 20% of the total cost. Progress payments will be billed at the end of the month, and the owner will transfer the billed amount minus any retainage to the contractor's account 30 days later (1 month later). Investigate the following: If the received payment is less than the expected contractor's revenue, how much should the contractor have as a line of credit to maintain the continuity in the construction of the project? Assume 2% of interest is applied. How much reduction in the profit expected due to the interest paid to the borrowing agency? Activity Preceded by Direct cost A B C Normal duration (month) 3 6 6 A A A 6000 24000 6000 0 4000 1600 8 2 B.C E F D 4
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started