Management Accounting Question

You have a GMP contract to build a corporate office for $10 Million. Your estimate includes a fee of 3 %, general conditions of $370,000 and no contingency. After Purchasing Phase is complete, you have abuy out of $350,000.
Before the job begins, what is your expected profit for the project?
As the job progresses, the excavator finds poor soil conditions on the site and the foundations need to be revised, at an extra cost of $ 200,000.
How do you pay for this extra?
After the soil problem is resolved, you are subjected to poor performance by the drywall subcontractor which delays the project 2 months. The cost to bring the project back on schedule is $200,000. How do you handle this problem?
About the recuiter
Member since Jul 20, 2017
Ron P.
from Queensland, Australia

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