Budgeting, Costs, and Cost Control - Welcome to...

Level 1 Construction Fundamentals Study Guide

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BUDGETING, COSTS, AND COST CONTROL

The Estimate and the Project BudgetThe estimate is a static document at a specific point in time (Bid time). The estimate reflectswhat the project was bid for and the quantities and unit prices used.

The project budget continuously evolves until project completion. The project budget reflectsthe actual scope at the site and the actual quantities from construction issued drawings and astandard productivity rate. The project budget will always include change orders and extra workorders in terms of changed quantities and costs. These terms are important because theproductivity and labor cost reports should reflect the project budget. Therefore, the projectbudget should reflect the actual quantities placed and a standard unit rate for each work activity.

This is considered the project budget. The project budget should be compared to the estimate butthis comparison should only be made in the Project Cost Summary Report. This report comparesthe actual and projected quantities, workhours and costs for the project to the estimated costs. This reports the current status and the latest forecast of profit or loss by cost codes.

The Earned WorkhourAn Earned Workhour is defined as the budgeted workhours earned for the quantity placed usingthe budgeted standard. The earned workhours for a work activity are calculated by multiplyingthe in place quantities (#units) by the budgeted standard workhours per unit rate (whr per unit).

Determining the Budgeted Quantities

The budgeted quantities should reflect the actual project being built, therefore, these quantitiesshould be calculated by someone in the office capable of determining the quantities for eachwork item from the construction issued drawings. These budgeted quantity takeoffs should betabulated in enough detail for each work item that the field can easily identify the quantity. Thequantity tabulation form should identify the take off by drawing numbers, revision numbers, areanumbers, equipment item numbers, system numbers and elevation. These quantity tabulationsheets are sent to the field and they are used to show work completed.

There are three basic Cost Control Reports. They are the Earned Workhour Report, the LaborCost Report and the Project Cost Summary Report. The purpose of the reports is to compareactual expenditures to the budgeted costs by the cost code established by the company andorganized into a Work Breakdown Structure.


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The Earned Workhour ReportThis report is used by the superintendent to track productivity on each work activity. This reportcompares the actual workhour per unit rate to the budgeted workhour per unit rate on a daily orweekly basis for each activity. A budgeted Whr per unit rate is established for each work item(cost code) using the contractor’s records for crew sizes and daily outputs. This budgeted Whrper unit rate is standardized throughout the company so that all superintendents are compared tothe same workhour per unit rate for each work item. This budgeted standard unit rate may or maynot be the rate used in the estimate, but for productivity purposes, all superintendents must becompared to the same rate. The budgeted standard unit rate is established by determining a baseyear, the standard crew size and daily output for each activity. The budgeted standard will neverchange, but the standard can be adjusted for each job due to working conditions, location andtrade agreements.

The Earned Workhour Report is used to compare the actual workhours expended to the budgetedworkhours and project the final workhours for each activity. The following discussion describeseach column of the Earned Workhour Report and the procedure used to arrive at the answer. 1. Cost Code. The Cost Code in the Example is 035300.

2. Activity Description. The cost code and description are from the contractor’s master codeof accounts and all projects within the construction firm are assigned the same cost codewith its respective activity description. The Activity Description in the example is WallForms 12".


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QUANTITIES3. Budgeted quantities are calculated from the plans and they reflect the actual quantities

that must be placed. The Budgeted Quantity is found in the Estimate Ledger and it is

1120 Square Feet of Contact Area. 4. Weekly quantities are the accumulated quantities that have been placed during the week.

The Weekly Quantity is found in the Inplace Quantity Report and for the example it is

60 Square Feet of Contact Area

5. To Date quantities are an accumulation of all previous weekly quantities. The CurrentWeekly Quantities are added to the To Date Quantity to arrive at the current To Datequantity placed. The To Date Quantity is found in the Inplace Quantity Report and for theexample it is

60 for Week + 64 (Previous Weeks) = 124 Square Feet of Contact Area.

6. Unit is the unit of measure used for that cost code. The Unit of measure in the example isSFCA which is an abbreviation for Square Feet of Contact Area..

EXPENDED WORKHOURS (Whr)7. Weekly workhours are the accumulated workhours spent for the week. The Weekly

workhours are found in the Weekly Labor Distribution and in the example it is 9 whrunder the straight time (ST) column which are all hours worked.

8. To Date Workhours isare an accumulation of all previous weekly workhours. The CurrentWeekly Workhours are added to the To Date Workhours to arrive at the current To DateWorkhours expended. The To Date Workhours is

The current week of 9 workhours plus the previous workhours from the DetailCost Ledger which is 15 workhours = 24 whr To Date.


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EARNED WORKHOURS9. Earned Workhours in this column are the total workhours earned to date using the

budgeted workhour unit rate and the quantities placed To Date. The earned workhoursare calculated by multiplying the To Date Quantities times the Budgeted Workhour/Unit.The Earned Workhours in the example are earned at the Budgeted unit Rate which is 192Whr/1120 SF = .171 Whr/SF. Therefore, the total workhours earned is calculated as

Placed 124 SFCA x .171 Whr/SFCA = 21 Whr.

10. Budgeted Workhours are the total workhours estimated to perform this activity. TheBudgeted Workhours are found in the Estimate Ledger and is 192 Whr.

UNIT WORKHOURS11. Budgeted Unit Workhour Rate is expressed in Whr per unit (Whr/Uint). The budgeted

standard rate is established company wide for each activity. The budgeted unit rate iscalculated by taking the total Budgeted Workhours and dividing by the BudgetedQuantities. The Budgeted Workhours per unit rate in the example is

192 Whr/1120 SFCA = .171 Whr/SFCA

12. Weekly Unit Workhour Rate is expressed in Whr per unit (Whr/Uint). The weekly unitrate is calculated by taking the Weekly Expended Workhours and dividing by the WeeklyQuantities placed. The Weekly Workhour per unit rate in the example is:

9 Whr/60 SFCA = .150 Whr/SFCA.

13. To Date Unit Workhour Rate expressed in Whr per unit (Whr/Uint). The To date unit rate is calculated by taking the To Date Expended Workhours and dividing by the To Date Quantitiesplaced. The To Date Workhour per unit rate in the example is

24 Whr/124 SFCA = .194 Whr/SFCA.

PERCENTAGE these percentages are used to compare the total Earned to the Budgeted.. 14. Earned Percentage is calculated by taking the total Earned Workhours and dividing by

the total Budgeted Workhours. The Earned Percentage in the example is 21 Whr /192Whr = 10.9%

15. Expended Percentage is calculated by taking the total Expended Workhours and dividingby the total Budgeted Workhours. The Expended Percentage in the example is 24 whr ToDate expended/192 Whr Budgeted = 12.5%.


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PROJECTED WORKHOURS16. Projected at Completion Workhours is a forecast of the total Workhours to be spent when

the estimated quantity is 100% complete. Using the Straight Line projection method, theprojected workhours at completion is calculated by multiplying the to Date WorkhourUnit Rate times the Total Budgeted Quantities. The Workhours Projected at Completionin the example is:

1120 SF x .19 Whr/SFCA = 213 Whr. (Three decimals .194 Whr/SF = 217 Whr.)

17. Projected Gain or (Loss) is calculated by subtracting the Projected Workhours atCompletion from the Total Budgeted Workhours and showing the net result. A (loss) isshown in parentheses. If the Projected Workhours at Completion is greater than the TotalBudgeted Workhours, you will show a (LOSS) in this column. If the ProjectedWorkhours at Completion is less than the Total Budgeted Workhours, you will show aGAIN in this column. The Projected Workhour Gain or (Loss) in the example is:

Budgeted Whr = 192 Whr - 213 Projected = (21) a loss.

The completed Earned Workhour Report is shown on the following page.


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Earned Workhour Report ExamplePROJECT NAME: Jobsite USA

PROJECT NUMBER: 001

CODE DESCR IPTION QUAN TITIES UNIT EXPENDED

W ORKHOURS

W ORKHO URS UNIT W ORKHO URS PERC ENT PROJECTED

BUDGET W EEK TO

DATE

W EEK TO

DATE

EARNED BUDGETED BUDGET W EEK TO

DATE

EARNED EXPENDED COM PLETION GAIN/

LOSS

035300 W all Forms 1120 60 124 SF 9 24 21 192 .17 .15 .19 10.9 12.5 213 (21)

Estimate

Ledger

Inplace

Qty

Current

W eek

Inplace

Qty

Current

W eek

+

Previou

s

Qty's

60 + 64

Labor

Dist

Current

W eek

Labor

Dist

Current

W eek

+

Detail

cost

9+15

[[[[[[[[

Estimate

Ledger

192

W hr

1120 Sf

9W hr

60 Sf

24 W hr

124 Sf

21 W hr

192 W hr

24 W hr

192 W hr

[[[[[[[[

192

- 213

(21)

124 Sf --------------------------

------

X --------------

-

.17 W hr

Sf

1120 Sf -----------------------------------------------------------------------

------------

X ------------------------------------------------

-

.19 W hr

Sf

---------------------------------------------

-----------

192 M inus 213 = (21)


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Inplace Quantities Report for the Example

PROJECT NAME Jobsite USA

PROJECT NUMBER 001

Cost Code Description Unit M T W T F Week

Total

PreviousTotal

To Date

Total

035300 Wall Forms SFCA 0 0 0 0 60 60 64 124

Week 2 Labor Distribution Report for of the Example

PROJECT NAME Jobsite U.S.A. PAYROLL ENDING August 5 PROJECT NUMBER 001 PAYROLL NUMBER ______6_______

Cost Code Craft WORKHOURS TOTAL RATE TOTAL

M T W Th F S S PT ST PRM REG PRM REG

035300 Carp 2/3 2 3 2.50 5.00 5.00

Cp 1/3 1 3 4.25 8.50 4.25 25.50

Cp /3 3 8.00 24.00

3/9 3 9 9.25 64.50

Note: PT indicates Premium Time.ST indicates Straight Time.

PRM means Premium or the Overtime Pay a person earns.REG Means the Regular Pay a person earns.


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Estimate Ledger for the Example

PROJECT NAM E JOBSITE USA

PROJECT NUM BER 001

COST CLASSIFICATION

1 2 4 5

Cost Code Description Quantity Unit Workhours Labor Cost M aterial Cost Equipm ent Subcontract Total

Wall Form - Original 720 122.00 2310.00 400.00 2710.00

C.C.O. #7 400 Sf 70.00 1285.00 504.00 300.00 207.00 2296.00

035300 Wall Forms 12" 1120 Sf 192 Whr 3595.00 904.00 300.00 207.00 5006.00

Detailed Cost Ledger for the Example

PROJECT NAME JOBSITE USA

PROJECT NUMBER 001

COST CLASSIFICATIONS

1 2 4 5

Cost Code Date Description Ref Quantity Workhours Labor Cost M aterial Cost Equipm ent Subs Cost Total Cost

035300 7/24 Wall Forms PR5 15 105.45 421.00 526.45

8/01 PO7 1141.00 220.00 1141.00

8/01 SC 44 220.00 220.00

15 105.45 1141.00 421.00 1887.45


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The Labor Cost ReportThis report is used to compare the actual labor costs to the budgeted labor costs and project thefinal cost for each activity. The budgeted labor costs are obtained from the estimate ledger whichshows the revised estimated cost. The actual labor costs are obtained from the weekly labordistribution and balanced with the detail cost ledger. Finally, the Labor Cost Report could becalled the Equipment Cost Report and the report could be used to determine the equipment costper unit (equip $/unit) instead of labor cost per unit on construction projects that are equipmentintensive.

1. Cost Code. The Cost Code in the Example is 035300.2. Activity Description. The cost code and description from the contractor’s master code of

accounts assigned to each activity that must be performed on the project. The ActivityDescription in the example is Wall Forms 12".

3. Budgeted quantities are calculated from the plans and they reflect the actual quantitiesthat must be placed. The Budgeted Quantity is found in the Estimate Ledger and for theexample it is 1120 Square Feet of Contact Area..

4. Weekly quantities are the accumulated quantities that have been placed during the week.

The Weekly Quantity is found in the Inplace Quantity Report and for the example it is 60Square Feet of Contact Area..

5. To Date quantities are an accumulation of all previous weekly quantities. The CurrentWeekly Quantities are added to the To Date Quantity to arrive at the current To Datequantity placed. The To Date Quantity is found in the Inplace Quantity Report and for theexample it is 60 for Week + 64 (Previous Weeks) = 124 Square Feet of Contact Area..

6. Unit is the unit of measure used for that cost code which is SFCA.

EXPENDED LABOR DOLLARS7. Weekly Expended Labor Costs are obtained from the Weekly Labor Distribution by

adding the Total Premium (PRM) costs plus the Total Regular (Reg) cost. The WeeklyExpended Cost from the Labor Distribution Week 2 is

$9.25 (PRM) + $64.50 (Reg) = $73.75.

8. To Date Expended Labor Costs are an accumulation of all previous weekly labor costs. The Current Weekly Labor Costs from the Weekly Labor Distribution are added to the ToDate Labor Costs from the Detail Cost Ledger to arrive at the Current To Date LaborCost. In the example, it is the $73.75 for the Week plus $105.45 from the Detail CostLedger = $179.00.


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BUDGETED COST9. Total Budgeted Costs are obtained from the Estimate Ledger. This figure is the original

estimated labor cost plus or minus all approved contract change orders. The TotalBudgeted Cost in the Estimate Ledger from the labor column is $3,595.00

UNIT COSTS10. Budgeted Unit Costs are calculated by taking the total estimated labor costs and dividing

by the Budgeted Quantities. The unit costs are always expressed in LABOR COSTS perunit ($L/unit). The Budgeted Labor Cost per unit in the example is:

$3,595/1120 SFCA = $3.21/SFCA

11. Weekly Unit Costs are calculated by taking the Weekly Expended Labor Costs anddividing by the Weekly Quantities placed. The example Weekly Labor Cost per unit is:

$73.75/60 SFCA = $1.21/SFCA

12. To Date Unit Costs are calculated by taking To Date Expended Labor Costs and dividingby the To Date Quantities placed. The To Date Labor Cost per unit in the example is:

$179.00/124 SFCA = 1.44/SFCA

PROJECTED LABOR COST13. Projected at Completion Labor Costs is a forecast of the total labor cost to be spent when

the estimated quantity is 100% complete. Using the Straight Line projection method, theprojected labor cost at completion is calculated by multiplying the To Date Unit Cost($/unit) times the Total Budgeted Quantities. The Projected Labor Cost at Completion is:

1120 SFCA x $1.44/SFCA = $1,613

14. Projected Gain or (Loss) is calculated by subtracting the Projected Labor Cost atCompletion from the Total Budgeted cost and showing the net result. A (LOSS) is shownin parentheses. If the Project Labor Cost at Completion is greater than the Total BudgetedCost, you will show a (LOSS) in this column. If the Projected Labor Cost at Completionis less than the Total Budgeted Cost, you will show a GAIN in this column. The ProjectLabor Cost Gain or (Loss) is:

$3595 Budgeted - $1,613 Projected = $1,982.

The completed Labor Cost Report is shown below.


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Labor Cost Report for the ExamplePROJECT NAME JOBSITE USAPROJECT NUMBER 001

CODE DESCRIPTION QUANTITIES EXPENDED COST

BUDGET

TOTAL

UNIT COST PROJECTED

BU D G ET W EEK TO D A TE UNIT WEEK TO D A TE BU D GET W EEK TO D A TE C O M PLETIO N GA IN /LO SS

035300 Wall Forms 1120 60 124 Sf 73.75 179 3595 $3.21/Sf 1.21/Sf 1.44/Sf 1613 1982

EstimateLedger

Qty

Inplace QtyCurrentWeek

Inplace QtyCurrentWeek +PreviousQty's60+64

LaborDist.CurrentWeek

$73.75

Labor Dist. CurrentWeek+DetailCost$73.75+105.45

EstimateLedger

$

$35951120Sf

$74 60 Sf

$179 124 Sf

[[[[[[[[[[

[[[[[[[[[[

1120 Sf X 1.44/Sf _____[ [[

3595 minus 1613 ___ [


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The Project Cost Summary ReportThis report is the most valuable report in terms of the overall project because it sums up allactual and projected quantities, workhours and costs for the project by cost code and comparesthem to the budget by cost code. The projected cost compared to the estimated cost shows thelatest prediction of a profit or loss for the overall project. This report forewarns management ofspecific work items that must be scrutinized closely to reduce losses to a minimum. If usedproperly, the project cost summary can be used to implement accurate decisions before the costsspiral out of control. The Projected Cost Summary Report is prepared from the budget anddetail cost ledgers and balanced to the accounting ledgers. The following discussion describeseach column of the Project Cost Summary Report and the procedure used to arrive at the correctanswer.

1. Cost Code. The Cost code for the example is 035316.

2. Activity Description. The activity description associated with the cost code of 035316 isWall Forms - 12".

3. Item. This Column summarizes the Budget, Actual Costs and Projected costs for eachcost code by the following items.

CODE ITEM

Quantity

Workhours

Labor

Material

Equipment

Subs

Sub Total Costs

BUDGET INFORMATION from the Estimate Ledger4. Original Budgeted column should reflect the quantities, workhours and cost

classifications taken from the original column in the estimate ledger. The OriginalBudget in the example is 720 SFCA.


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5. Scope changes are increases or decreases in quantities, workhours and costclassifications through approved contract change orders. The Scope changes areobtained from the estimate ledger. Also, internal shifts in the cost classifications fromthe original estimate to reflect the actual project being built called the budget are alsorecorded here, but they must be kept separated from the contract change orders. TheScope Changes in the example resulted in an additional 400 SFCA.

6. Revised Budget is the Accumulative total for the actual project budget. The revisedbudget is calculated by adding the Original Budgeted to the Scope Changes and showingthe net increase or decrease in the Revised Budget column. The Revised Budget in theexample is:

720 SFCA Original Budget + 400 SFCA Scope changes = 1120 SFCA

Expended Information from the Detail Cost Ledger7. Period Expended column reflects the quantities, workhours and cost classifications that

have been expended since the last report. Normally, the period consists of one month.The period items are obtained from the detail cost ledger. This is a stand-alone column itis for reference purposes only.

8. Expended To Date. This column reflects the quantities, workhours and costclassifications are an accumulation of previous period items expended. The Perioditems are added to the to Date Figure from the Previous report to arrive at the CurrentExpended To Date figure in this report. The To Date-Expended Column in the exampleindicates that:

ExpendedTo Date

CommittedCost

ExpendedTotal Costs

Quantity 124 SFCA 0 124 SFCA

Workhours 24 Whr 0 24 Whr

Labor Costs $179 0 $179

Material Costs $800 $341 $1,141

Equipment Costs $421 0 $421

Subcontract Costs $100 $120 $220

Sub Total Costs for Cost Code 035316 $1,500 $461 $1,961


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9. Committed Costs are shown separately from the To Date Expended costs to indicate thatthe contractor is contractually required to pay for an item but it has not actually beenpaid for yet. This column is used to put cost items that you have contracted for such assubcontracts and purchase orders immediately into the ledger system. The accountingsystem usually only reflects actual expended costs, therefore, to obtain the ExpendedTotal Cost when the contract is 100% paid for it is placed into this column first. TheCommitted Costs in the Example are:

Material Costs $341.00

Subcontract Costs $120.00

Subtotal Costs $461.00

10. Expended Total column is calculated by adding the Expended To Date Column to theCommitted Costs column for each item. The Expended Totals in the example are:

Expended

Total

124 SFCA

24 Whr

$179

$1,141

$421

$220

$1,961

Committed Cost ExampleFor example, assume that you have signed a subcontract Agreement with the Electricalcontractor for $350,000. The contract calls for three monthly payments of $100,000 at the endof the first month with subsequent payments of $125,000 and $125,000. Upon signing thecontract, the $350,000 would be placed into the Committed Cost column immediately and theCommitted Cost would be added to the Expended To Date Costs, which is $0 in the first month.Therefore, the Expended Total Cost column would be $350,000.

Transaction

Date

Expended

To Date

Committed

Cost

Expended

Total Cost

Sub, Immediately 0 $350,000 $350,000


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In the second month, the Expended To Date Costs would be $100,000 in the second month and$250,000 would be placed into the Committed Cost column and the Committed Cost would beadded to the Expended To Date Costs of $100,000. Therefore, the Expended Total Cost columnwould still be $350,000.

Transaction

Date

Expended

To Date

Committed

Cost

Expended

Total Cost

Sub, Second $100,000 $250,000 $350,000

The purchase orders, subcontracts and rental Equipment are recorded into the detail cost ledgeras committed costs at the time they are written.

Projections by the Project Manager11. Current projection at Completion is a prediction of the total to be spent when the item is

100% complete. There are three methods for projecting at completion.

Using the Straight Line Projection Method and projecting the At Completion(Forecast) number by multiplying the To Date Unit Cost ($/unit) times the TotalBudgeted Quantities.

Using the Expended Total Column and projecting the Expended Total column asthe projected at completion number.

Using the Revised Budget Column and projecting the Revised Budget as theprojected at completion number.

The Current Projection in the example was made based upon the followingmethods.

Current

Projection

Projection Method

Quantity 1120 SFCA Revised Budget

Workhours 24 Whr/124 SF = .19 x 1120 SF 213 Whr Straight Line

Labor Costs $179/124 SF = $1.44/SF x 1120 SF $1,613 Straight Line

Material Costs $1,141 Expended

Equipment Costs $421 Expended

Subcontract Costs $220 Expended

Sub Total Costs for cost code 035316 $3,395 \\\\\\\\\\\\\\\\\\\\\\\


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12. Projected Gain or (Loss) is calculated by subtracting the Current Projection from thetotal Revised Budget and showing the net result: a gain or a (loss) shown in parentheses.If the Projected Labor Cost at Completion is greater than the Total Revised BudgetedCost, you will show a (loss) in this column. If the Projected Labor Cost at Completion isless than the total Revised Budgeted Cost, you will show a gain in this column.

Revised Budget Current Projection Gain/(Loss)

Quantity 1120 SFCA 1120 SFCA 0

Workhours 192 Whr 213 Whr (21) Whr

Labor Costs $3,595 $1,613 $1,982

Material Costs $904 $1,141 ($237)

Equipment Costs $300 $421 ($121)

Subcontract Costs $207 $220 ($13)

Sub Total Costs 035316 $5,006 $3,395 $1,611

The completed Project Cost Summary Report is shown on the following page.


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Project Cost Summary ExamplePROJECT NAME JOBSITE USAPROJECT NUMBER 001

CODE ITEM ORIGINAL

BUDGET

SCOPE

CHANGES

REVISED

BUDGET

EXPENDED COMMITTED

COST

EXPENDED

TOTAL COST

CURRENT

PROJECTED

COST

PROJECTED

GAIN/LOSS

PERIOD TO DATE

035316 Wall Forms

Quantity 720Sf 400Sf 1120Sf 60Sf 124Sf 124Sf 1120Sf 0Sf

Workhours 122Whr 70Whr 192Whr 9 24Whr 24Whr 213Whr (21) Whr

Labor $2310 $1285 $3595 $179 $179 $1613 $1982

Material $400 504 904 800 341 1141 1141 (237)

Equipment -0- 300 300 $421 421 421 (121)

Subcontracts -0- 207 207 100 `120 220 220 (13)

Sub Total Costs $2710 $2296 $5006 $1500 $461 $1961 $3395 +1611

[___ + [_____ = [ [______ + [_____ = [

REVISED ESTIMATE 5006 MINUS CURRENT PROJECTION $ 3395 EQUALS PROJECTED GAIN(LOSS) BUDGET +1611


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The Work Breakdown Structure

The Work Breakdown Structure (WBS) or the Master Code of Accounts should be developed bythe contractor for use on all projects throughout the company. The master Work BreakdownStructure is a set of cost codes arranged into a hierarchy of recognizable categories used tocompare all estimated and actual costs on a project. The work breakdown structure is the keyelement in a job cost control system. This portion of the cost control system is commonlyoverlooked and little or no attention has been paid to its importance. For a control system to beefficient, the work breakdown structure must follow a logical sequence of events and provide ahierarchy of management reports designed to meet the information requirements at differentlevels of management. The work breakdown structure is intended to provide a common basisfor integrating accounting, cost control, scheduling and estimating information. Flexibility mustbe designed into the work breakdown structure to encompass all types of construction and it hasthe capability of segregating costs for the client's capital cost records.

An approach commonly used to develop a code of accounts is to arrange the construction itemsinto the same categories and logical sequence the estimator uses when developing a quantitytakeoff and cost estimate. These categories are called a "hierarchy" and they are used to providemanagement with reports that can be summarized at different levels. A typical Code ofAccounts requires a minimum of seven digits to work effectively. The components of a typicalcode of accounts are shown below.

2 03 1 3 3 0

Size

Type of Operations

Tube & Coupler

Operations - Placing Scaffolding

1 _ _ _ Allocable Items or 2 _ _ _ Type of Work of Work Locations

Major Discipline or Division - Concrete Foundations

Cost Classification - Materials, Permanent


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Cost Reports Exercise

Using the Earned Workhour Report information provided, Answer the following questions.

1. What is the Budgeted Unit Workhours in Whr per Unit for the Column Forms?

A. 0.045B. 0.171C. 0.241D. 5.838

2. What is the Weekly Unit Workhours in Whr per Unit for the Column Forms?

A. 0.007B. 0.195C. 4.919D. 5.118

3. What is the To Date Unit Workhours in Whr per Unit for the Column Forms?

A. 0.011B. 0.241C. 3.821D. 4.148

4. What are the Total Earned Workhours for the Column Forms?

A. 19B. 27C. 465D. 2387

5. What is the Total Projected Workhours at Completion for the Column Forms?

A. 27B. 104C. 602D. 2472


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6. What is the projected gain or loss in Workhours for the Column Forms?

A. (174)B. 325C. 1897D. 2396

Using the Labor Cost Report attached, answer the following questions.

7. What is the Budgeted Labor Unit Cost in Dollars per unit for the Concrete Footings?

A. 0.047B. 21.45C. 137.25D. 256.00

8. What is the Week Labor Unit Cost in Dollars per unit for the Concrete Footings?

A. 0.70B. 1.43C. 3.14D. 14.60

9. What is the To Date Labor Unit Cost in Dollars per unit for the Concrete Footings?

A. 0.32B. 3.14C. 20.12D. 5125.00

10. What is the Total Projected Labor costs at Completion for the Concrete Footings?

A. 81.41B. 803.84C. 5150.72D. 10615.00


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11. What is the projected gain or loss in Labor Dollars for the Concrete Footings?

A. (1.20)B. (4685.00)C. 338.00D. 5452.46

Using the Project Cost Summary Report attached and the Forecast information below, answerthe following questions.

FORECAST the Current Projection column as follows:

QUANTITY - Project the REVISED ESTIMATE column WORKHOURS - Project using the Straight Line Method LABOR COST - Project using the Straight Line Method MATERIAL COST - Project the REVISED ESTIMATE column EQUIPMENT COST - Project the TOTAL EXPENDED column SUBCONTRACT COST - Project the TOTAL EXPENDED column

12. What is current projection for the quantities in Vertical Lineal Feet (VLF)?

A. 680B. 5300C. 5980D. 6700

13. What is the current projection for the Workhours at completion?

A. 78B. 473C. 618D. 686

14. What is the current projection for the labor costs at completion?

A. 11,960B. 13557C. 14917D. 16817


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15. What is the current projection for the material costs at completion?

A. 7080B. 33470C. 40550D. 45225

16. What is the current projection for the Equipment costs at completion?

A. 1400B. 14640C. 16040D. 16960

17. What is the current projection for the subcontract costs at completion?

A. 0B. 7000C. 14000D. 21000

18. What is the current projection total costs at completion?

A. 29957B. 70170C. 76470D. 85080

19. What are the projected workhours gain or loss?

A. 0B. 67C. (134)D. (218)


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20. What is the projected labor cost gain or loss?

A. (1900)B. 1900C. 2957D. 13557

21. What is the projected material cost gain or loss?

A. 0B. 4675C. 7080D. 11755

22. What is the total projected gain or loss?

A. (6363)B. (9843)C. 7975D. 14589

23. The estimated cost of a project if built today is $4,000,000 and the costs are expected torise 3.5 percent for the next 5 years. What will be the estimated cost if the project isbuilt five years from now?

A. $4,700,000B. $4,750,745C. 17,936,133D. 24,213,779

24. The budget calls for 40,000 Lineal Feet of lumber and the labor is budgeted at $26,000.The work completed to date is 8,000 Lineal Feet of lumber and the labor cost is $6,000.What is the projected total labor cost savings or labor cost overrun at completion?

A. $2,000 savings.B. $4,000 savings.C. $4,000 overrun.D. $10,000 savings.


378

Cost Reports Exercise - Earned Workhour Report Information

DESCRIPTION QUANTITIES UNIT EXPENDEDWORKHOURS

WORKHOURS UNIT WORKHOURS PROJECTED

BUDGET WEEK TODATE

WEEK TODATE

EARNED BUDGETED BUDGET WEEK TODATE

COMPLETION GAIN/LOSS

Col. Forms 2499 87 112 SFCA 17 27 428

Concrete Ftg 256 25 40 CY 40 85 360

Concrete Wa 453 30 34 CY 40 44 634

Footing Frms 2417 210 410 SFCA 42 102 499

Wall Forms 25,560 1880 3090 SFCA 364 664 5544


379

Cost Reports Exercise - Labor Cost Report Information

CODE DESCRIPTION QUANTITIES EXPENDED COST TOTALBUDGET

$

UNIT COST PROJECTED

BUDGET WEEK TODATE

UNIT WEEK$

TODATE

BUDGET WEEK TODATE

COMPLETION GAIN/LOSS

Col. Forms 2499 87 112 SFCA 223 355 8022

Concrete Ftg 256 25 40 CY 365 805 5490

Concrete Walls 453 30 34 CY 394 431 9669

Footing Form 2417 210 410 SFCA 449 1038 8154

Wall Forms 25,560 1880 3090 SFCA 3812 6855 90370


380

Cost Reports Exercise - Project Cost Summary Report Information

CODE ITEM ORIGINALESTIMATE

SCOPECHANGE

REVISEDESTIMATE

EXPENDED COMMITTED TOTALEXPEND

CURRENTPROJECTION

PROJECTEDGAIN (LOSS)

WEEK TODATE

035600 PILES

Quantity 6700 VLF (720) 5980 VLF 680 0 680

Workhours 618 WHR (67) 551 WHR 78 0 78

Labor 16817 (1900) 14917 1360 0 1360

Material 45225 (4675) 40550 10000 23470 33470

Equipment 16040 (1400) 14640 7600 9360 16960

Subcontract 0 0 0 7000 0 7000

78082 (7975) 70107 25960 32830 58790

Budgeting, Costs, and Cost Control - Welcome to...

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