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    Question

    In contract costing, 'Retention Money' refers

    to:
    A The profit earned on the contract. Correct Answer Incorrect Answer
    B A part of the contract value withheld by the contractee until the satisfactory completion of the contract. Correct Answer Incorrect Answer
    C The advance payment made by the contractee. Correct Answer Incorrect Answer
    D The cost of materials stored at the site. Correct Answer Incorrect Answer

    Solution

    Retention Money is a portion of the certified value of work done that is held back by the customer (contractee). It acts as a security to ensure that the contractor rectifies any defects or completes any pending work during the defect liability period.

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