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My Class - CCM > SOP - Cost Management > Flashcards

SOP - Cost Management Flashcards

1
Q

What are the elements of the CM’s role in Cost Management?

A
  • Create and implement a system to control cost, control cost growth
  • Design Cost Management Plan (CMP), deliver within budget, provide financial forecast
  • Manage project costs and cash flow, communication
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2
Q

Who has primary responsibility for controlling cost on the project?

  • The CM
  • The owner
  • The contractor
  • The designer
A

The CM

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3
Q

Which of the following is not a type of conceptual estimating?

  • Analogous estimating (top down)
  • Unit takeoff
  • Parametric modeling
  • Bottom-up estimating
A

Unit takeoff

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4
Q

What are some types of conceptual estimating methods?

A
  • Analogous estimating (Top-down estimtating)
  • Bottom-up estimating
  • Parametric modeling
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5
Q

What is the acronym for defining a project by breaking down the project into all of its various work components and arranging them in a hierarchical structure?

  • ABC
  • WBS
  • UBC
  • IBC
A

WBS

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6
Q

What does a realistic budget contain?

  • Consideration of the owner’s goals and objectives, reasonable procurement strategy, identified project constraints
  • Consideration of the owner’s goals and objectives, generated cost that matches available financing, identified project constraints
A

Consideration of the owner’s goals and objectives, reasonable procurement strategy, identified project constraints

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7
Q

What does a realistic budget contain?

A
  • Consideration of the owner’s goals and objectives
  • Reasonable procurement strategy
  • Identified project constraints
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8
Q

What does the typical “S” curve show?

  • Cumulative expenditures
  • Monthly expenditures
  • Monthly cash flow
  • Earned value
A
  • Cumulative expenditures
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9
Q

What does the typical bell curve show?

  • Cumulative expenditures
  • Monthly expenditures
  • Monthly cash flow
  • Earned value
A
  • Monthly expenditures
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10
Q

Cumulative expenditures are shown on a ________ curve

A

“S” curve

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11
Q

Monthly expenditures are shown on a ________ curve

A

bell curve

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12
Q

What is the formula for Schedule Variance?

  • Earned Hours or $$ to date ÷ Budgeted Hours or $$ to date
  • Earned Hours or $$ - Budgeted Hours or $$
  • Earned Hours or $$ - Actual Hours or $$
  • Earned Hours or $$ to date ÷ Actual Hours or $$ to date
A

Earned Hours or $$ - Budgeted Hours or $$

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13
Q

Schedule Variance formula = Earned minus _________

A

Budgeted

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14
Q

Cost Performance Index formula = Earned to date divided by _____

A

Actuals to date

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15
Q

What is the formula for the Cost Performance Index?

  • Earned Hours or $$ to date ÷ Budgeted Hours or $$ to date
  • Earned Hours or $$ - Budgeted Hours or $$
  • Earned Hours or $$ to date ÷ Actual Hours or $$ to date
  • Earned Hours or $$ - Actual Hours or $$
A

Earned Hours or $$ to date ÷ Actual Hours or $$ to date

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16
Q

What are the primary risks associated with cost estimating for the CM?

  • Price changes and labor availability
  • Design and scope changes
  • Owner interprets CM’s estimate as a “warranty” and focus’s on a single number vs. range
  • Legal liability
A

Owner interprets CM’s estimate as a “warranty” and focus’s on a single number vs. range

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17
Q

What is a solution to managing cost estimating risk for the CM?

  • Transfer risk to other parties
  • Continually manage expectations and establish a realistic contingency
  • Ensure the designer is responsible for any estimates
  • Develop a building information model
A

Continually manage expectations and establish a realistic contingency

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18
Q

What is the minimum information needed for a conceptual cost estimate?

A
  • Project type
  • Project size or capacity
  • Project location
  • Project schedule
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19
Q

The primary factors on which a CM should evaluate a bid are?

A
  • Completeness and Responsiveness
  • Technical / references
  • Math errors and alternates
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20
Q

Which individual on the project/program team has primary responsibility for cost control throughout the project?

  • The owner
  • The contractor
  • The designer
  • The CM
A

The CM

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21
Q

What is the CM’s primary role in cost management during the construction phase?

  • Ensuring the project remains on schedule
  • Keeping everyone happy and on task
  • An aggressive and timely resolution of change order issues
  • Managing the contractors
A

An aggressive and timely resolution of change order issues

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22
Q

CM’s must take an _________ approach to resolving change order issues.

A

aggressive and timely

23
Q

Cost monitoring involves these tasks:

A
  • Report actual vs. planned costs
  • Estimate cost at project completion
  • Determine the need for cash flow based on planned vs. actual cash
  • Track actual vs. planned performance
24
Q

When managing cost, the CM must control the project _________________ and deliver the project within budget.

A

budget and cost growth

25
Q

Cost management activities during the project’s close-out include:

A
  • Release of liens
  • Release of retainage
  • Final cost accounting
  • Final close-out report
26
Q

Cost control starts during this project phase:

  • Pre-Design
  • Design
  • Procurement
  • Construction
A

Pre-Design

27
Q

The Man-hour Analysis is:

A. A tool to determine if the contractor is behind or on schedule
B. Useful for change order and claim analysis concerning lost productivity and lost efficiency
C. A technique that compares a non-impacted portion of the project with the impacted portion
D. Both A and B
E. Both A and C

A

Both A and B

28
Q

A _____________ analysis is a tool to determine if the contractor is behind or on schedule and useful for change order and claim analysis concerning lost productivity and lost efficiency:

A
29
Q

T/F
When processing claims, the burden of proof is on the CM to substantiate entitlement and damages.

A
30
Q

_____________ is defined as “The process of looking at the design and finding ways to maximize value for the client by delivering a design that meets the program…”

  • Market analysis
  • Value Analysis
  • Design analysis
  • Cost analysis
A

Value Analysis

31
Q

Developing a cost management system involves these processes, EXCEPT:

  • Identifying resources needed
  • Estimating cost of resources
  • Procuring resources and materials
  • Allocating estimate costs
  • Controlling changes that impact the accepted budget
A

Procuring resources and materials

32
Q

Developing a cost management system involves these processes:

A
  • Identifying resources needed
  • Estimating cost of resources
  • Allocating estimate costs
  • Controlling changes that impact the accepted budget
33
Q

These items are needed to develop a cash flow schedule, EXCEPT:

  • Detailed estimate
  • Cash flow analysis
  • Conceptual project schedule
  • Conceptual estimate
A
  • Detailed estimate
34
Q

Cost or price may vary with these types of procurement strategies:

A. Firm fixed price and unit price
B. Cost reimbursement and firm fixed price
C. Unit price and cost reimbursement

A

Unit price and cost reimbursement

35
Q

Public entities usually provide _______ flexibility with procurement strategies

A

Less

36
Q

The cash flow schedule allows the owner to predict when the project will need cash. To fund the project, the owner would typically need the most cash during this phase of the project:

A. Initial start of project
B. Design phase
C. Beginning of the Construction phase
D. Middle of the Construction phase

A

Middle of the Construction phase

37
Q

A cost management system should:

track ______,
identify _______,
and help predict how decisions ________ the budget.

A

track costs,
identify variances,
decisions impact the budget

38
Q

A ________________ system should track costs, identify variances, and help predict how decisions impact the budget.

A

cost management

39
Q

What type of estimating is typically used for negotiating change orders or settling claims or disputes?

A. Quantity-based survey estimating
B. Range estimating
C. Feasibility estimating
D. Definitive estimating

A

Range estimating

40
Q

What type of change order pricing is done after work has already been completed?

A. Forward pricing
B. Actual cost pricing

A

Actual cost pricing

41
Q

___________ estimating is typically used for negotiating change orders or settling claims or disputes

A

Range estimating

42
Q

What technique compares a non-impacted portion of the project with the impacted portion and also allows an “earned value analysis” to determine the productivity impacts of change orders?

A. Man-hour analysis
B. Measured mile
C. Value analysis
D. Market analysis

A

Measured mile technique

43
Q

Select the two types of cost estimates.

A. Conceptual and Monumental
B. Monumental and Guaranteed
C. Detailed and Guaranteed
D. Detailed and Conceptual

A

Detailed and Conceptual

44
Q

Construction cost is a ______ of the overall project cost.

A

subset

45
Q

Project contingencies _________ as the project progresses from inception to completion.

A

decrease

46
Q

The process of incorporating a balance change culture of recognition, planning, and evaluation of project changes in an organization to effectively manage project changes.

A

Change Management:

47
Q

When a contract is bid and awarded on a lump sum basis, the CM must obtain a _______________ from the contractor

A

Schedule of Values

48
Q

you should prudently set aside for a new construction project _____% of your contract award amount to deal with change orders

A

10% of your contract award amount

49
Q

The average construction contingency is 5-10% but is recommended to be ______%

A

10 to 15%

50
Q

For a renovation or modernization project, set aside ______% as a decent rule of thumb.

A

15%

51
Q

AACEI refers to conceptual estimates as an “order of magnitude” and defines accuracy at +50% to -30%.

A

+50% to -30%

52
Q

You ought to be able to predict the cost of construction on bid day, plus or minus __% of the actual bid amount

A

5%

53
Q
A

My Class - CCM (13 decks)

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