CBP CBP Estimating & Cost Control 1 — Questions and Answers
Question 1: Which estimating method uses historical cost data from similar completed projects to predict the cost of a new project?
- Parametric estimating
- Analogous estimating (Correct answer)
- Bottom-up estimating
- Three-point estimating
Correct answer: Analogous estimating
Analogous estimating uses historical data from similar past projects as a basis for predicting costs of a new project.
Question 2: A contractor receives a bid for $450,000 on a job estimated at $400,000. What is the bid-to-estimate variance percentage?
- 10%
- 11.1%
- 12.5% (Correct answer)
- 15%
Correct answer: 12.5%
The variance is ($450,000 - $400,000) / $400,000 = $50,000 / $400,000 = 12.5%.
Question 3: In a unit-price contract, the contractor is paid based on:
- A fixed lump sum regardless of quantities
- The actual cost plus a fee
- Predetermined prices per unit of work completed (Correct answer)
- A percentage of the total project value
Correct answer: Predetermined prices per unit of work completed
Unit-price contracts pay a set amount per measurable unit of work (e.g., per cubic yard of concrete or linear foot of pipe).
Question 4: Which document provides the most detailed breakdown of materials, labor, and overhead for a construction estimate?
- Bid bond
- Schedule of values
- Quantity takeoff sheet (Correct answer)
- Notice to proceed
Correct answer: Quantity takeoff sheet
A quantity takeoff sheet itemizes every material and labor component needed, forming the quantitative foundation of a construction estimate.
Question 5: Overhead costs in construction estimating are typically categorized as:
- Direct and indirect costs
- Fixed and variable costs
- General and project overhead (Correct answer)
- Hard and soft costs
Correct answer: General and project overhead
Overhead is divided into general overhead (company-wide costs like office rent) and project overhead (site-specific costs like a job trailer).
Question 6: What is the primary purpose of a contingency allowance in a construction budget?
- To cover the contractor's profit margin
- To fund design changes requested by the owner
- To account for unforeseen costs and uncertainties (Correct answer)
- To pay subcontractor retainage
Correct answer: To account for unforeseen costs and uncertainties
A contingency allowance is a budget reserve set aside to cover unexpected costs or scope uncertainties that arise during construction.
CBP CBP Estimating & Cost Control 1
Which estimating method uses historical cost data from similar completed projects to predict the cost of a new project?