Profitable pricing/Estimating

Question 1

Select all answers that apply. The pricing that collectively contribute to the bid price of a job are:

Score of the Dodger game

Overhead costs

Gut feelings

Competitor pricing

Dow Jones daily activity

Profit

Direct costs

Answer 1

Overhead costs

Profit

Direct costs

Question 2

Select all that apply. Costs contributing to Labor Burden are:

State Unemployment Insurance

Workers Compensation

Office Expenses

New Equipment Purchases

State Disability Insurance

FICA

Your Fancy New Truck

Answer 2

State Unemployment Insurance

Workers Compensation

State Disability Insurance

FICA

Question 3

Choose all that apply. The Dual Overhead Rate Method adds overhead costs to items to recover those costs?

Materials

The cost of your kid’s dorm room

Labor

Profit

Answer 3

Materials

Labor

Question 4

Bottom line profit is contingent upon the accuracy of the __________

Overhead Markup

Profit Margin

Landscape Plans

Estimated Labor & Materials Cost

Answer 4

Estimated Labor & Materials Cost

Question 5

Production Standards are predetermined by tracking the production of crews working on specific _______________

Political Strategies

Job Sites

Pieces of Equipment

Maintenance Services, Installation or Construction

Answer 5

Maintenance Services, Installation or Construction

Question 6

Estimate

Answer 6

Is an approximation or educated guess based on a company’s financial database

Question 7

Bid

Answer 7

The total job price presented to a client

Question 8

Take Off

Answer 8

Area measurements made and quantities taken from blueprints or landscape plans

Question 9

Direct Costs

Answer 9

All material and labor with appropriate markups, subcontractors at cost, equipment cost per hour

Question 10

Indirect Costs

Answer 10

Costs associated with the job but not part of the specific service or installation. Examples are permits, bonds, equipment

Question 11

Production Standards

Answer 11

Are adjusted when practices change due to the introduction of new equipment and/or methods

Question 12

Overhead

Answer 12

Costs incurred on a regular basis regardless of the amount of work being completed

Question 13

Direct Costs

Answer 13

Costs that can be attributed to a specific job

Question 14

Break Even Point

Answer 14

Direct Costs + Overhead Costs

Question 15

Materials to Labor Ratio

Answer 15

The compensation weighting factor is applied this in the DORM calculation

Question 16

Profit

Answer 16

The compensation acquired after direct costs and overhead costs are paid

Question 17

Labor Burden

Answer 17

The amount of taxes, insurance, etc. added as a percentage to every dollar of labor paid

Question 18

Overhead Markup

Answer 18

Added to labor, materials or both to get to the break even point