Question: Power Engineering is subcontracted to provide technical support for a new hydrogen manufacturing plant in Northwest Province, South Africa. They entered a contract with the
Power Engineering is subcontracted to provide technical support for a new hydrogen manufacturing plant in Northwest Province, South Africa. They entered a contract with the following condition.The subcontract is valued at R million. Should the works be completed to the client's satisfaction at a cost lower than its agreed value, then the subcontractor shall be entitled to a costsaving incentive of of the savings. On the contrary, should the costs be exceeded, the subcontractor shall be held accountable and pay the full extra costs incurred. Calculate how much Power will get or pay in incentives under the following conditions The works are finished at a cost of R million The works are completed at a cost of R million. marks marks Indicate how much profit or loss Siyazama Projects Pty Ltd will make under the following fixed price contracts.a Siyazama was contracted to pave a km road at a fixed cost of R million. The project costed R million.b Siyazama charged Bows Investments R million to build a small bridge.The project cost was R million.c Siyazama charged R million to repair flooddamaged powerlines. The total cost was R million.
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