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Estimating 2 Final

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The contract documents utilized to communicate scope by the designer, and evaluated by the estimator are:
b. Advertisement for Bids, Instructions to Bidders, Project Drawings, Project Specifications
(5)The Cost Breakdown Structure (CBS) contains the following data headings on its horizontal axis (columns).
b. Cost Categories
Whats the difference between mark-up and margins?
Mark-up is for example marking the entire project up a certain percentage such as 15%. Margins, for example would be pro-rating certain areas certain percentages or raising prices certain percentages based on whats completed or whats left.
The main difference between a Work Breakdown Structure (WBS) and Cost Breakdown Structure (CBS) is:
d. cost items vs. activities
Don't allow cost to interfere with price, keep the development of cost away from price.
true
(4)List 4 outputs to the BUILD Stage from the BID Stage:
a. .BASELINE b. .SCOPE c. .RESOURCE REQUIREMENTS d. .WORK PLAN AND SCHEDULE e. COST INFO
What price structure element does the general cost fall under?
JOH
Separation of the scope of work and requirements into smaller, component packages, so that work effort can
d. decomposition.
Performing work outside the scope of the contract results in:
c. unpaid extra work
What are the 4 price structure elements?
a. profit b. BOH c. JOH d. direct cost
Pay items
is a division of your cost items; ex. Electrical would be a pay item, and wiring, switches, fans, lights....... These are cost items.
which of these could be marked up?
c. Pay item
(2)List the 2 elements comprising equipment resource charge rates:
a. .OWNERSHIP COST b. .OPERATING COST
Which of these involve cost categories?
b. CBS
Some contractors only use two divisions, (overhead/profit and Job Cost) why is this bad?
Can't tell what your actual profit is and can't tell how much money you will be able to keep. Also the data would not be able to be used in future projects.
In the CBS the Horizontal Axis is made of cost categories, while the Vertical axis is made of cost items (2x4s, shovel, printers....)
true
what is a balanced bid?
A balanced bid is when your JOH is evenly distributed throughout all your pay items based on the pay items percentage of the total cost of the project.
(3)List the 3 elements of Labor Burden based upon direct wages:
a. .TAX b. .INSURANCE c. .FRINGE BENEFITS
The estimating team's cost is recovered through which Price Element of the Price Structure:
c. Corporate Overhead
The estimator(s) typically determine the amount of Business Overhead applied to a construction cost estimate.
b. FALSE
The main tool utilized by the builder to verbally communicate the scope of work:
c. Basis of Estimate (BOE)
The 7 functions are necessary in a bid stage because they separate the different aspects and areas of the bid that have to be completed to turn a bid in on time.
true
. (7)List the 7 Processes of the Bid Stage
a. .SETUP b. .SCOPE c. .COST d. .PRICE e. .REVIEW f. .BID g. .LAUNCH
what is the difference between price and cost?
The cost is what the project cost the construction company while the price is what the owner is charged to have the project done.
) Changes to the project's scope of work during the bid stage are identified and acknowledged by the owner with:
c. an addendum
mark up rules;
example, marking up mobilization with some profit to have extra cash early
1. (5) List the AACE International Estimate Classifications are differentiated by which primary characteristic:
estimating methodology, degree of project definition end, usage of the estimate, time and effort needed to prepare.
In the PBS the Horizontal axis is made of Price structure elements while the vertical axis is made of pay items. (electrical, mechanical,....)
true
) Davis-Bacon wage rate determinations would be required on a project for building dormitories at Camp Shelby:
a. True
) Labor Burden is treated as belonging to which Price Structure segment/element in our spreadsheet application:
a. Direct Cost.
(5) Which type of AACE Estimate Classification is the estimate in our Project-1?
Class-5.
The main tool utilized by the estimator to communicate the scope of work (as discussed in class):
b. Cost Breakdown Structure (CBS)
Estimator is responsible for direct cost and JOH, while the accountant is responsible for home office BOH.
true
Performing work inside the scope boundary of the contract results in:
a. contractual default-breach of contract
Labor burden falls under Direct Cost
true
Why break CBS down into categories? Adding everything together into one sum, why not?
B/c if you break it into labor, equipment, burden, materials, tax, rentals, You can tell how much of your money is going to each individual category and have real time ratios to compare and realize where money is lost.Ex. You may have 2 jobs both 20million, but one has a 2 million dollar labor cost and the other has a 10 million dollar labor cost. They are not the same in many ways, the more and higher the labor cost the riskier the job, so one of the jobs is much riskier than the other even though they are the same price.So using categories or CBS is they best way to manage the cost and money.
A Cost Item is classified as Job Overhead if:
a. it is part of General Conditions or General Requirements b. it is NOT associated with a Pay Item or Schedule of Value item c. it involves salaried project supervision d. all of the above
Why is it important to know the boundaries between (profits, BOH, JOH, direct cost)?
They tell you where your money is going. This data is important so that the data can be used in future projects, they are also important b/c if you know the difference you can cover loss from one division by using another one of the divisions.
(5) The general conditions delineate costs associated with:
a. Project supervision. b. Indirect equipment usage. c. Temporary construction. D All of the above.
7 processes of a bid stage:
setup, scope, cost, price, review, bid, launch.

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