CEC Value Engineering & Cost Control Flashcards

Life-cycle cost analysis (LCCA) differs from initial cost estimating primarily because it:

Answer: Includes operation, maintenance, and disposal costs over the asset's useful life

LCCA captures total ownership costs—capital, operations, maintenance, and disposal—giving a more complete picture for VE decision-making.

Which cost control tool compares actual unit costs in the field to the estimated unit costs used in the bid?

Answer: Unit cost variance report

A unit cost variance report highlights discrepancies between estimated and actual productivity or unit costs, flagging operations that need corrective action.

What is 'constructability review' in the context of value engineering?

Answer: An analysis of design documents by field experts to find costly or impractical sequences before construction

A constructability review involves experienced field personnel examining plans and specs to identify design elements that are difficult or expensive to build and suggest practical alternatives.

When tracking cost-to-complete (CTC) during construction, the estimator should base projections on:

Answer: Current field productivity data and updated supplier quotes

Accurate CTC forecasts use current field performance data and up-to-date material pricing rather than outdated bid assumptions.

A variance at completion (VAC) of negative $150,000 means:

Answer: The project is projected to overrun its budget by $150,000

A negative VAC indicates the project is forecast to exceed its budget by that amount, signaling that corrective action is needed.

Which method best aligns cost control with field production by comparing budgeted cost of work performed to actual cost?

Answer: Earned value management (EVM)

Earned value management integrates scope, schedule, and cost by measuring the budgeted value of work actually completed versus what was spent, providing objective performance metrics.