Lecture 12 Flashcards
Cost Estimating
The estimate is used to:
– set (or compare against) the ________
– obtain project financing – ____ flow estimates
– compare among __________
– _______ order estimates
budget, cash, alternatives, change
Types of Estimates: (4)
conceptual estimate, preliminary estimate, detailed estimate, and bid estimate
Levels of detail in estimates
* _________ estimate (also called approximate, preliminary, or budget estimate)
– Broad scope: ________ design begins
– Narrow scope: ________design process
Conceptual, before, during
Levels of detail in estimates
* The details of the estimating procedure (also called ______ _____ estimate)
– Based upon completed drawings and specs
– Requires:
* Accurate _________ survey
* Accurate ______ ______ and production rates
* Estimators understanding of field _________
final cost, quantity, unit costs, operation
Procedure for Estimating
1. ___________ review
– “Documents” are drawings, specifications, bid form, other contract documents
2. _________Take-Off (QTO)
3. Unit _________
4. __________
– Contingency, overhead, profit
– Analysis of estimate (adjustments needed?)
– Using the estimate (project control)
document, quantity, pricing, compiling
Sources for Pricing and Labor Rates
* ___________ per-unit estimates
* Sub-contractors / work crews
* Past ___________ with similar projects
* Contractor/supplier bids or _______
historical, experience, quotes
Direct costs are expenses that can be traced _______ to a specific construction ________, task or project.
directly, activity
Indirect Field Costs
* Costs that can be charged to a specific _______ but not to a specific _____ _____ on that project
project, work item
Indirect Field Costs
Typically, __-___% (may be much higher %) of total project ____, but must be carefully itemized (i.e., do not simply add a % to the direct cost)
– Also called General Conditions, Project overhead costs, Job
overhead costs, and Direct overhead costs
5-15%, cost
Fee (or “Mark-up”)
* A contractor’s “fee” for a project commonly refers to home office __________ plus ______
overhead, profit
Home office overhead
– Also called ________ _________ or indirect overhead or General & Administration (G&A)
– Costs not charged directly to a specific project
– Covers home _______ expenses; _________ for executives, estimators, inspectors, administrators, etc.; misc
general overhead, office, salaries
Profit is _______ money going directly to the ______ company
– Even if a company makes zero profit on a job, all of its expenses, including employee salaries, may still have been paid in full
extra, owner
Contingency
* An amount added to an estimate to allow for items, conditions, or events for which the state, occurrence, or effect is ________ and that experience shows will likely result, in aggregate, in additional _______
uncertain, costs
Steps to Preparing a Detailed Estimate
1) Review the ______of Work
2) Determine the __________ of each type of Work (Material Quantity Takeoff)
3) Determine cost of _________ from vendors
4) Determine cost of _______ from direct labor rates
5) Determine cost of construction __________ (owned and rented)
6) Determine cost of _________ work from specialty contractor bids
7) Determine ______, bonds, insurance and general and administrative overhead
8) Determine project __________ (amount set aside for unforeseen negative events or unexpected costs)
9) Determine reasonable _______ for your effort (return on investment)
scope, materials, labor, equipment, specialty, taxes, contingency, profit
Labor Estimating Procedure
1. Labor __________ Rate
Work per unit time or per other unit or X work hours per unit
2. _________ Takeoff
Required number of units (including waste)
3. Work ______ Required
Productivity rate (work hours per unit) x quantity takeoff
4. Payment ____
hourly crew labor cost
5. Activity _______ Cost
Work Hours Required x hourly crew labor cost
Productivity, quantity, hours, rate, labor
Estimating Equipment Costs
* Equipment cost is generally a ___________ component of heavy-civil projects, much less for _________ projects
* Equipment cost can be quite _________ dependent upon:
– Construction methods
– Ownership (owned or rented)
– Field conditions
significant, building, variable
Lump-Sum Bid
* A lump sum contract is a contract where the contractor agrees to complete the entire project for a _______ ________, regardless of the actual quantity of work done.
* beneficial for projects that have _____-_______ and stable scopes
* allow the contractor to plan and control the budget and schedule more
precisely and efficiently
* reduce the risk of cost overruns or delays
fixed price, well-defined
Unit Price Bid
* A unit price contract is a contract where the contractor agrees to perform a specific quantity of work for a ______ _______ per ____
* beneficial for projects that have uncertain or ________ _________ of work
* allow the contractor to adjust the price according to the actual work done
* reduce the risk of disputes over changes in scope or unforeseen conditions
fixed price, unit, variable quantities
Types of construction contracts
lump-sum or fixed price contract
unit pricing
cost-plus
time and materials contracts
guaranteed maximum price (GMP)
Unit price Reference - CSI
____________ _______________ ___________
(CSI) http://www.csinet.org
* 16 major divisions in the CSI format
(pre-2004, now 50 divisions)
* Grouped by building trades and
related broad scope sections
* Provides the industry __________ for
cataloging design information
Construction Specification Institute, standard
