CLC Estimating & Cost Control Flashcards

A lead carpenter tracks that a trim installation job used 15% more labor hours than estimated. The most productive response is to:

Answer: Analyze the cause and adjust future estimates for similar work

Identifying the root cause of cost overruns (complexity, rework, access issues) and adjusting future estimates improves bidding accuracy and prevents recurring losses.

What is the main purpose of a lien waiver in construction payment processes?

Answer: To release a contractor's or supplier's right to file a mechanic's lien upon receiving payment

A lien waiver is a document signed by a contractor, subcontractor, or supplier acknowledging payment and waiving their right to place a mechanic's lien on the property for that amount.

When reviewing a monthly job cost report, a negative cost variance means:

Answer: Actual costs are higher than budgeted costs

A negative cost variance (actual > budget) indicates a cost overrun, meaning the job is spending more than estimated and profitability is being eroded.

Which of the following is the best practice for handling disputed extra work costs with a client?

Answer: Document all extras with photos, notes, and a written change order before proceeding

Documenting extras with evidence and securing a signed change order before performing the work is the industry best practice for preventing payment disputes.

Earned Value Management (EVM) compares which two metrics to measure project performance?

Answer: Budgeted cost of work performed vs. actual cost of work performed

EVM compares Budgeted Cost of Work Performed (BCWP/Earned Value) against Actual Cost of Work Performed (ACWP) to determine cost and schedule efficiency.

A retainage clause in a construction contract typically withholds what percentage of each progress payment?

Answer: 5–10%

Retainage in US construction contracts is typically 5–10% of each draw, held by the owner until substantial completion or final acceptance to ensure the contractor completes all work.