CSLB Estimating, Bidding, and Cost Control 2 — Questions and Answers
Question 1: Which estimating method uses cost-per-square-foot figures from similar past projects to produce a quick early estimate?
- Parametric estimating (Correct answer)
- Bottom-up estimating
- Quantity takeoff
- Earned value analysis
Correct answer: Parametric estimating
Parametric estimating uses statistical relationships between historical data (e.g., cost per square foot) and project parameters to quickly estimate costs in early project phases.
Question 2: A contractor's 'labor burden' includes which of the following in addition to base wages?
- Material costs and equipment rental
- Payroll taxes, insurance, workers' comp, and benefits (Correct answer)
- Subcontractor overhead and profit
- Permit fees and inspection costs
Correct answer: Payroll taxes, insurance, workers' comp, and benefits
Labor burden includes all employer-paid costs beyond base wages: FICA taxes, FUTA, SUTA, workers' compensation premiums, health insurance, and other benefits.
Question 3: When preparing a bid, a contractor discovers a material error in their calculations after submitting. Under California law, the contractor may typically:
- Withdraw the bid without penalty by notifying the owner promptly (Correct answer)
- Never withdraw a submitted bid
- Only adjust the bid if approved by all other bidders
- Amend the bid within 24 hours
Correct answer: Withdraw the bid without penalty by notifying the owner promptly
California Public Contract Code permits a bidder who discovers a clerical or material error to withdraw their bid without forfeiture of bid bond if they promptly notify the owner before award.
Question 4: Which document defines exactly what the contractor is responsible for building and forms the basis of the bid?
- The bid bond
- The specifications and drawings (contract documents) (Correct answer)
- The project schedule
- The subcontractor list
Correct answer: The specifications and drawings (contract documents)
The specifications and drawings together constitute the contract documents, defining the scope, materials, and standards the contractor must meet — these are the basis of the bid.
Question 5: On California public works projects, a prime contractor typically must perform at least what percentage of the work with their own forces?
- 10%
- 25% (Correct answer)
- 50%
- The law sets no minimum for public works
Correct answer: 25%
California Public Contract Code generally requires a prime contractor on public works to self-perform at least 25% of the work, limiting how much can be subcontracted out.
Question 6: What is the purpose of a 'contingency' allowance in a construction estimate?
- To cover the contractor's profit on the project
- To fund design changes requested by the owner
- To account for unforeseen conditions and estimating uncertainties (Correct answer)
- To pay for permit fees
Correct answer: To account for unforeseen conditions and estimating uncertainties
A contingency allowance provides a financial buffer within the estimate or budget to cover unforeseen conditions, minor scope changes, or estimating inaccuracies.
CSLB Estimating, Bidding, and Cost Control 2
Which estimating method uses cost-per-square-foot figures from similar past projects to produce a quick early estimate?