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Construction Cost and Time Management Flashcards

7 cards from real CCM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Construction Cost and Time Management flashcards as text

  1. A CM is evaluating a value engineering proposal that reduces first cost by $200,000 but increases annual maintenance costs by $30,000 over a 10-year life cycle. Using a simple payback approach, the net benefit is:

    Answer: A net saving of $100,000 but requires life-cycle cost analysis to confirm

    Simple payback shows $200K savings vs. $300K additional maintenance over 10 years = net loss; however, time value of money (life-cycle cost analysis) is required for a complete evaluation.

  2. What is 'free float' in CPM scheduling?

    Answer: The time an activity can be delayed without delaying the early start of any successor

    Free float is the amount of time an activity can be delayed without affecting the early start date of any of its successor activities.

  3. A cost-plus-incentive-fee (CPIF) contract has a target cost of $1M, target fee of $100K, and a 80/20 share ratio. If actual cost is $900K, what is the contractor's fee?

    Answer: $120,000

    Under-run = $1M − $900K = $100K; contractor's share = 20% × $100K = $20K; fee = $100K + $20K = $120,000.

  4. During project execution, the owner requests an acceleration of the schedule. Which factor should the CM evaluate FIRST before committing to the new completion date?

    Answer: Impact on critical path activities and associated cost premiums

    The CM must first analyze which critical path activities will require crashing or fast-tracking and calculate the associated cost premiums before committing to an accelerated schedule.

  5. Which document formally establishes the approved project budget and serves as the basis for Earned Value Management?

    Answer: Performance Measurement Baseline (PMB)

    The Performance Measurement Baseline (PMB) is the integrated scope, schedule, and cost plan against which project execution is measured in an EVM system.

  6. A contractor submits a Time Impact Analysis (TIA) for a two-week owner-caused delay. What must the TIA demonstrate to support a schedule extension request?

    Answer: That the delay affected a critical path activity and extended the project completion date

    A TIA must show, through network analysis, that the delay event impacted a critical path activity and that this impact extended the project's predicted completion date.

  7. What is the primary purpose of a 'contingency reserve' in a project budget?

    Answer: To address identified risks with quantified cost impacts (known unknowns)

    Contingency reserve is budget included in the cost baseline to cover identified risks (known unknowns) whose probability and impact have been quantified during risk analysis.