What is the total cost if a job experiences a change leading to a reduction of $1,200 in labor and $240 in overhead costs?

To determine the total cost after experiencing a reduction in labor and overhead costs, you start with the current total cost before these reductions. The question indicates there are reductions of $1,200 in labor and $240 in overhead.

You sum these reductions first, which gives you a total reduction of $1,440 ($1,200 + $240). If the pre-change total cost were a specific amount, subtracting this reduction from that total would give the new total cost.

When the new cost of $3,371 is calculated, it implies that this figure is what remains after applying the reductions to the initial total cost. Therefore, if the original cost was $4,811 ($3,371 + $1,440), this total aligns correctly with the given answer.

This understanding helps clarify that the total cost after accounting for these deductions yields the final figure of $3,371. Thus, the rationale behind this choice lies in recognizing how reductions in costs directly impact the overall budget for the job, leading to the appropriate adjusted total.