Multi-Storey Builders Ltd Had a Large Three-Year Project with Total

question 18

Multiple Choice

Multi-Storey Builders Ltd had a large three-year project with total revenue of $8 000 000 and estimated total costs of $6 500 000.The project was 20 per cent complete at the end of the first year,70 per cent complete at the end of the second year and 100 per cent complete at the end of the third year.Revenues and costs were as estimated.
- How much profit was earned during the third year if the percentage of completion method was used?

• A) $450 000
• B) $750 000
• C) $1 500 000
• D) $240 000

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Definitions:

Anchoring

A cognitive bias in decision-making and information-processing where an initial piece of information serves as a reference point for judgments and decisions that follow.

Memory Retrieval Routes

The processes and pathways by which stored information is recalled from the brain.

Inconsistent Information

Data or facts that do not align with each other, creating a conflict or contradiction in understanding or interpretation.

Schema

A cognitive framework or concept that helps organize and interpret information in the world around us.