Managing Construction 10

Question 1

Part of getting work is to know

Answer 1

the final cost of a project. If you know your final cost, then the poker game starts.

Question 2

How do you arrive at an accurate cost of the project?

Answer 2

There are two CRUCIAL steps:

1. The proper application of OH costs for the project.
2. Look in the book for the second reason.

Question 3

Since labor causes home office support to be needed, the higher the labor content of a job is,

Answer 3

the HIGHER THE OH should be FOR THAT PROJECT.

Question 4

If you bid a HIGH LABOR project using a single rate for OH, you would be low bidder but:

Answer 4

the job will have higher overhead and you will pay for it out of profit.

Question 5

A low labor content project using the same SINGLE RATE will be

Answer 5

overpriced, since it will require less home office support.

Question 6

DUAL RATE METHODOLOGY for assigning OH to a project helps to

Answer 6

accurately apply OH expenses to project costs for bid price determination or job costing analysis.

Question 7

Superior project managers focus on :

Answer 7

the FINANCIALS and the SCHEDULE for the job. THESE ARE THE TWO MAJOR AREAS OF RISK IN A CONSTRUCTION PROJECT.

Question 8

The concept of BID CONDITIONING is extremely important. What page is it on?

Answer 8

117-123

Question 9

A job that has no labor and all subcontractors is typically:

Answer 9

CASH FLOW NEUTRAL to the contractor, except for general conditions and the overhead in the office.

Question 10

From a financial perspective, the best job you could wish for is

Answer 10

A project that is paying well and demands less working capital.