Ch01_Cost

Question 1

3 fundamentals attributes associated with performing an activity or acquiring an asset:

Answer 1

1. Price / Cost
2. Features / Performance
3. Availability / Schedule

Question 2

Cost Definition in general

Answer 2

• Value of activity or asset

Question 3

Cost Definition in Project control and accounting:

Answer 3

• is the amount measured in money, cash expended or liability incurred, in consideration of goods. and\ or services received

Question 4

Cost Definition in total cost management include:

Answer 4

• any investment of resources in strategic assets including time, monetary, human and physical resources

Question 5

cost engineering:

Answer 5

is the application of scientific principles and techniques to problems of estimation, cost control, business planning and management science, profitability analysis. project management, and planning and scheduling.

Question 6

`typical categories of cost:

Answer 6

1. a. direct labor,
2. b. labor burden

2,a, owned equipment
2.b rented equipment
2,c installed equipment

3.a material
3,b tax on material

Question 7

what is the raw data, which makes up asset / activity cost?

Answer 7

is the cost item and resource charge rates.

Question 8

cost centre

Answer 8

group of activities within a project that provide a convenient point for collecting and measuring costs.

Question 9

cost element grouping example:

Answer 9

• cost center
• labor craft
• material type
• inventory ( purchase value of material and installed equipment)
• overhead
• equipment
• subcontractors
• other direct costs
• commitments

Question 10

cost element:

Answer 10

• direct
• indirect
• fixed
• variable

Question 11

direct cost in construction:

Answer 11

cost of installed equipment, material, labor and supervision directly or immediately involved in the physical construction of the permanent facility

Question 12

direct cost in manufacturing, services and other non construction industries

Answer 12

the portion of operating costs that is readily assignable to a specific area.

Question 13

Cost accounting

Answer 13

recording, classifying, and summarizing cost element cost element data in terms of money expended with time

Question 14

Activity Based Costing (ABC)

Answer 14

resources that are used, are assigned to activities that are required to accomplish a cost objectives.

Question 15

the 4 most common method of how cost information is applied to cost management:

Answer 15

cost estimating
cost trending
cost forecasting
life cycle costing