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CM > Estimating > Flashcards

Estimating Flashcards

1
Q

What is direct cost?

A

Anything that has a discrete physical cost associated with the project

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2
Q

What is indirect cost?

A

Anything that does not have a discrete physical cost associated with the project

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3
Q

What are the 6 levels estimates?

A

1) Conceptual Estimate project (feasibility studies)
2) Estimate to Evaluate Alternate Design
3) Owner’s Engineer’s Estimate
4) Contractor’s Bid Estimate
5) Alternative Construction Methods Estimate
6) Change Orders or Claim Estimate

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4
Q

What is conceptual estimate?

A

owner’s general scope of the project

↳ used for a broad estimate of the project

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5
Q

What is estimate to evaluate alternate designs?

A

Estimates based on past projects with similar scopes

↳ uses unit prices and rough quantifications of units

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6
Q

What is owner’s engineer’s estimate?

A
  • The estimate is given after the design is 80 -90% completed
  • Based on quantity takeoff
  • Relays on past bid abstracts
  • Will likely not consider construction methods
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7
Q

What is contractor’s bid estimate?

A
  • Most detailed out of all the estimates
  • Based on the contractor’s Quantity takeoff (QTO)
  • Will consider construction methods
  • based on contractor’s detailed cost record
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8
Q

What is alternative construction methods estimate?

A
  • identify a cheaper way of getting the job done

- the goal is to maximize profit

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9
Q

What is change orders or claim estimate?

A

Estimate for change orders

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10
Q

What are the 7 cost categories?

A
  • Labour (L)
  • Permanent Materials (PM)
  • Expendable Materials (EM)
  • Subcontracts (S)
  • Equipment Operating Expense (EOE)
  • Repair and Service Labor (RL)
  • Rental (R)
  • Operated and Maintained (O&M rental)
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11
Q

What level of risk does labour have and why?

A

Highest risk cost element

  • Direct labour is the most volatile
  • Highly productivity-related
  • The most difficult cost to estimate and control during project performance
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12
Q

What level of risk does permanent material have and why?

A

Low Risk

  • Not productivity related
  • Can be accurately determined and is therefore not volatile
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13
Q

What level of risk does expendable material have and why?

A

Less risk than direct labour but still potentially high risk

  • Not particularly productivity-related but can be very difficult to determine accurately and are thus always volatile to some extent
  • In some projects can be highly volatile
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14
Q

What level of risk does subcontracts have and why?

A

Low Risk if covered by performance bond

  • Highly productivity-related from subcontractor’s point of view
  • But, not productivity-related from prime contractor’s point of view provided that the subcontractor’s quote entered in the prime contractor’s bid estimate is secured by a 100% performance bond
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15
Q

What level of risk does equipment operating expense have and why?

A

Not necessarily risky but can be if operating under harsh conditions

Highly related to the kind of work being performed and can be fairly volatile on equipment intensive jobs

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16
Q

What level of risk does repair and service labour have and why?

A

Shares risk attributes of Direct Labor but normally will not be as high a cost

17
Q

What level of risk does rental have and why?

A

Could be risky?

  • Highly dependent on the type of construction project and on the contractor’s business philosophy and equipment policy
  • In-house rental
  • Third party rental
18
Q

What level of risk does operated and maintained have and why?

A

Can be highly risky if no incentive
But not particularly risky if rental or owned

  • With the exception of O&M rental this cost element is not particularly volatile
  • O&M rental, however is highly productivity related and is just as volatile as direct labor
19
Q

What is permanent material? Give an example

A

Material that is in between the neat lines of the construction drawing. Usually very low risk since it is very clear on what the quantity is.

Ex. A foundation slab in the drawing. You know all the dimensions and therefore the amount can be determined.

20
Q

What is expendable material? Give an example

A

Material that falls outside the neat line of a constriction drawing.

Ex. Formwork. When pouring the form, the overflow would be considered expendable material.

21
Q

What costs are included in the EOE category of cost?

A
  • Fuel, Oil, Grease (FOG)
  • Tires
  • Small repairs parts (spark plugs, oil filters etc)
  • 3rd party overhaul
22
Q

List all different options for supplying equipment to your project

A
  • Rental
  • O&M (Operated and Maintained)
  • In house rental from another division
  • Joint venture with another company
  • Buy and Sell
23
Q

What 3 items are generally included in Markup?

A
  • Risk Coverage
  • Home office
  • Profit
24
Q

Provide a sketch detailing the different types of contingency that management needs to consider.

A

Contingency

Identified => productivity hedge, soft subs, special risk
unidentified => covered in markup

24
Q

In a schedule of bid-item bid identify the costs that when added together make up the total amount to be distributed

A

• Indirect: Job Office, Safety, Time/Non-time Related expenses, Insurances, Taxes
• Direct cost: materials, direct labour, subcontractor costs
• Escalations: Price of supplies and materials increasing
• Markup: % of the total cost, % of the labour, and consideration of the total horizontal
distribution
• Contingency: Money that might need to be readjusted or set aside for potential accidents. Can
be separated into identified/unidentified
• Interest: When borrowing money, the money will have a fee associated with it that the owner
will have to pay

25
Q

What guidelines would you follow in distributing your fixed costs + markup to the individual big items of a schedule-of-bid-items bid?

A
26
Q

List the 5 categories of indirect costs and provide an example for each.

A
  • Salaried Payroll: Management, engineering, supervision
  • Time-related overhead: Warehouse operation, supplies, utility bills
  • Non-time-related overhead: office furniture, office equipment
  • Insurance and taxes: explains its self
  • Construction plants in-and-out: Fencing, surfacing, furnish buildings
27
Q

What two contract provisions do you need to read and understand before conducting a quantity takeoff?
Explain the significance of each of these provisions?

A
28
Q

List the 5 takeoffs that could be required for a particular bid item.

A
  • Work quantity
  • Pay quantity
  • Permanent material
  • Expendable material
  • Subcontractors
29
Q

List the different quantity takeoffs that you would complete for the structural concrete bid item for a bridge pier.

A

CM (3 decks)

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