What Is the Most Important Risk in Determining the Validity

question 77

Multiple Choice

What is the most important risk in determining the validity of construction delay claims?

• A) Contractor claims may be submitted prior to completion of the work.
• B) Contractor claims may include costs considered in the fixed-price portion of the work.
• C) Contractor claims may include subcontractor estimates of balances due to the subcontractor.
• D) Contractor claims may be understated.

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Definitions:

Activity-Based Costing

A method of allocating overhead and indirect costs to products or services based on the activities that drive those costs.

Cost Of Serving

The total expenses incurred while delivering a service or product to a customer.

Direct Labor Cost

The expense related to the wages of workers directly involved in the production of goods or services.

Activity-Based Costing

A costing method that assigns costs to products or services based on the activities and resources that go into producing them, aiming for more accurate cost allocation.