Utah Contractor Practice Exam

Which of the following correctly describes a requirement for a schedule of payments in an original bid?

1. The schedule must include specific dates and dollar amounts

2. The second payment is not due until after 60% of the work is completed

3. The material must be paid for as it is installed

4. You are not required to include a schedule of payments in the original bid

The correct answer is: You are not required to include a schedule of payments in the original bid

In the context of construction contracting, a schedule of payments outlines the installments to be paid by the client throughout the course of a project. While including a schedule can be beneficial for clarity and financial planning, it is not mandated that every contractor must present one in the original bid. This means that while some bids may include a detailed payment schedule to help set expectations for both parties, it is ultimately at the discretion of the contractor to include it or not. Requiring such a schedule could be seen as an additional layer of complexity that may not be necessary in every contracting situation, especially for smaller projects. Therefore, contractors can choose to outline payment terms in a manner that fits the project's unique requirements and their own business practices, making it feasible to omit the payment schedule entirely in the bid. Conversely, the other options impose limitations or expectations that are not always applicable. Specific payment amounts and dates, payment schedules tied to project completion percentages, or requirements for immediate payment upon material installation may be terms seen in more complex contracts or among certain clients, but they do not universally apply to all original bids.