An Estimate of $1,395

question 4

Short Answer

An estimate of $1,395.95 is submitted for a job. The actual material cost is $275.49, and the labor and overhead come to $496.96. What profit does the contractor expect on the job?

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Definitions:

IRR

Internal rate of return. A capital budgeting technique that rates projects according to their expected return on invested funds. The higher the return the better.

MIRR

Modified Internal Rate of Return (MIRR) is a financial metric that evaluates the profitability of investments, adjusting the internal rate of return (IRR) to account for the reinvestment of cash flows at a different rate.

Present Value

The current value of a future amount of money or stream of cash flows, discounted at a certain interest rate.

Future Value

The amount a present sum will grow into at a specified interest rate over a specified period of time.