PRELIMINARY
COST
ESTIMATES
FINAL COST ESTIMATE
FINAL
COST
ESTIMATE
Company controlling
External - financial accounting
Controlling is one of the managerial
• Accounting that provides information to people functions like planning, organizing,
outside the business entity is called financial
accounting staffing and directing.
• ~ provides information to present financial data
to potential shareholders, creditors such as
banks or vendors, financial analysts, Must include the project financial
economists, and government agencies management system, which is
• ~ is governed by rules (Generally Accepted
Accounting Principles) particularly important in the
• bookkeeping (e.g. double-entry bookkeeping) construction industry because of the
long-term pre-financing.
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For instance:
• making load-bearing wall m3
• making formwork m2
• steel, reinforcing, place t, kg
• placement of prefabricated elements piece
• making canal m
• Cost codes are derived from the WBS.
• Each level of the WBS constitutes a cost code grouping as shown
above.
• Cost codes can be developed at the lowest WBS level and then
summarized at any level within the WBS hierarchy.
Highway bridge, Highway bridge, After the quantity survey has been completed and decisions
construction equipment summary sheets concerning methods and equipment have been made, the
total quantities are transferred from the quantity sheets to
• the estimator have to know the type and productivity of summary sheets for pricing purposes.
the equipments that actually will be used during
construction operations
• it is necessary to devise a list of larger equipment needs,
e.g.:
• 50-ton crane equipped with an 80-foot boom: for
pouring concrete, placing structural steel, and driving
steel piles
• 7,200-foot-pound double-acting hammer and a 900-
cubic-foot-per-minute portable air compressor with
hose and connections: for the pile driving
• a tractor with low-boy trailer and a 25-ton crane: for
transport and assembly of the pile driving rig
• a crawler tractor with bulldozer blade: for the
unclassified excavation
• 1-cubic-yard backhoe: for the structural excavation
• a flatbed truck
• a troweling machine
• a concrete saw
Highway bridge,
Process of the project cost estimating summary sheet
Assuming that our contractor is the successful bidder, it must now restructure
its estimate into a more suitable format for subsequent cost control of the
actual construction work.
This involves the preparation of the control budget.
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Sum up: process of the project cost estimating Profit = revenues - costs
Profit: the ultimate goal, which is the
guarantor and quantitative indicators of
successful activity.
market-driven pricing
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market-driven pricing:
• pricing according to perceived value
• competitive strategy based on competitors
• capacity-based pricing
• competitive tendering (procurement)
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Summary
Bibliography Bibliography
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State of Alaska - Department of Education & Early Development,
Education Support Services/Facilities, Juneau, Alaska, 1999 7. Szőnyi L: Cost Planning of Building Investments, Budapest University of
http://www.eed.state.ak.us/facilities/publications/LCCAHandbook1999.pdf Technology and Economics, Department of Construction Technology &
Date accessed: 24.03.2010 Management (in Hungarian: Építőipari beruházások költségtervezése),
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of 4th Nordic Conference on Construction Economics and Organisation :
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universitet, Luleå, 2007, http://www.ltu.se/staff/j/jutsch?l=en Date
accessed: 24.03.2010
4. DIN 18960 User costs of buildings (Nutzungskosten im Hochbau)
Deutsche Norm, Februar 2008. In: Fröhlich, P.J.:Hochbaukosten -
Flächen - Rauminhalte, DIN 276 - DIN 277 - DIN 18960,
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200, ISBN 978-3-8348-0591-1
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