CRC Cost Estimation & Budgeting 5

Question 1

A contractor receives three subcontractor bids for HVAC: $18,000, $21,500, and $31,000. What is the BEST practice when selecting a bid to include in the prime estimate?

Accepted Answer

Evaluate all bids for scope completeness before selecting

Answer

The lowest bid may exclude scope items; all bids must be evaluated for completeness and accuracy before selection.

Question 2

When calculating material costs for a tile installation, a contractor measures 420 sq ft of floor area. Using a 12% waste factor, how many sq ft of tile should be ordered?

Accepted Answer

470 sq ft

Answer

420 sq ft × 1.12 = 470.4 sq ft, rounded to 470 sq ft.

Question 3

A remodel project is 60% complete and has spent $84,000 of a $120,000 budget. What does this indicate about the project's cost performance?

Accepted Answer

The project is over budget — 70% of budget used for 60% completion

Answer

At 60% completion, expected spend should be $72,000 (60% of $120,000); spending $84,000 means the project is 16.7% over budget at this stage.

Question 4

Which of the following BEST describes 'life cycle cost analysis' in residential construction?

Accepted Answer

Estimating the cost of a project from design through demolition

Answer

Life cycle cost analysis evaluates total costs of ownership including initial construction, operating, maintenance, and eventual demolition costs.

Question 5

A contractor builds 10 identical spec homes per year. Which estimating approach would be MOST efficient for recurring projects of this type?

Accepted Answer

Parametric estimating using cost-per-unit models from historical data

Answer

Parametric estimating using historical data from previous identical homes allows fast, accurate estimates for repeated project types.

(CRC) Certified Residential Contractor Practice Test

(CRC) Certified Residential Contractor Practice Test

CRC Cost Estimation & Budgeting 5