...BASICS of COST PLANNING & COST ESTIMATE By Victor Lau B.Sc., M.Sc., MHKIS, MRICS 28 February 2006 COST PLANNING & COST ESTIMATE • DEFINITIONS, TERMS & PROCESSES • TYPES OF PRE-CONTRACT COST PLANNING • FACTORS AFFECTING COST ESTIMATES/PLAN 2 DEFINITIONS, TERMS & PROCESSES A. Classification of Areas B. Terms of Cost Estimate & Cost Plan C. Pre-Contract Cost Planning Processes 3 DEFINITIONS, TERMS & PROCESSES A. CLASSIFICATION OF AREAS GROSS FLOOR AREA (GFA) GFA is the area contained within the external walls of the building measured at each floor level (including any floor below the level of the ground), together with the area of balconies and the thickness of external walls (for submission to Planning Authorities) Note : Carpark & plant room areas are usually excluded, but this is NOT a fixed rule CONSTRUCTION FLOOR AREA (CFA) CFA is the covered areas fulfilling the functional requirements of the building measured to the outside face of the external walls or external parameter. Areas occupied by partitions, columns, internal structural walls, bay windows, stairwells, lift shafts, plant rooms, water tanks, carparks, open covered areas and the like are included. 4 DEFINITIONS, TERMS & PROCESSES B. TERMS OF COST ESTIMATE & COST PLAN ELEMENTAL QUANTITY • No. of door • Area of wall finishes • Volume of concrete structure • Elemental quantity per CFA (i.e. Element Quantity / CFA) • Average cost per unit elemental quantity (i.e. Total Cost of Element...
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...Arthur H00112430 Construction Project Management 2011 to2012 D39CC Andrew Jackson Coursework title Design Cost Planning and Control Coursework hand-in deadline (date specified for hand- in) June 22 2012 All students are advised to keep a duplicate copy of all work submitted for reference. DECLARATION I certify that this assignment is my original work expressed in my own words. Any reference made to the work of other authors in any form (eg ideas, figures, text, tables) are acknowledged at their point of use. Signature/s of student ……………………………… Date of submission: ……………………… Below this line for office use only ………………………………………………………………………………………………………………………………………… School of the Built Environment Heriot-Watt University Edinburgh EH14 4AS Scotland UK Tel: 0131 449 5111 Fax: 0131 451 3161 Date Stamp Assignment: A high –level report, advising the client on the viability of the proposed project, a three storey Health Center, 4500 m2 Gross Floor Area (GFA). 1 Table of Contents Introduction………………………………………………………………………………………………………………3 BCIS Analysis Data………………………………………………………………………………………………………4 Sustainability………………………………………………………………………………………………………………..6 Building Research Establishment Assessment Method………………………………………………8 Appendices…………………………………………………………………………………………………………………9 References……………………………………………………………………………………………………………………15 Introduction Construction Cost Estimating is considered one of the most essential tasks in the budget development of any project. In most...
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...Chapter 9 Profit Planning: Cost-Volume-Profit Analysis Cases |9-1 |Cost-Volume-Profit Analysis and Strategy | |9-2 |Cost-Volume-Profit Analysis and Cost Estimation | |9-3 |Cost-Volume-Profit Analysis and Strategy | |9-4 |Cost-Volume-Profit Analysis and Strategy: The ALLTEL Pavilion | |9-5 |Sensitivity Analysis; Regression Analysis | |9-6 |Profit Planning: Choice of Cost Structure | |9-7 |Pancake World | Readings 9-1: “Tools for Dealing with Uncertainty” by David R. Fordham, CMA, CPA, Ph.D and S. Brooks Marshall, CFA. DBA This article explains how to use simulation methods within a spreadsheet program such as Excel to perform sensitivity analysis for a given decision context. The available spreadsheet simulation software systems include the programs Crystal Ball and @Risk, among others. These software systems allow the user to analyze the effect of uncertainty on the potential outcomes of a decision. These tools can be applied directly to CVP analysis. The tools allow...
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...The Cost of Business Continuity Planning Versus the Potential of Risk Though the cost of mitigating risk can be high, the lack of proper business continuity planning and disaster recovery planning will leave a company is at risk of a catastrophic loss of revenue due to the loss of the Information Systems. Any company that relies on its Information Systems for their operations should invest the time and revenue in developing an efficient and effective Business Continuity Plan (BCP) and a Disaster Recovery Plan (DRP). This study will compare the differences in what a Business Continuity Plan is used for and what a Disaster Recovery Plan is used for. Additionally, it will evaluate the risk having a Business Continuity Plan and Disaster Recovery Plan versus accepting the potential loss of revenue and business in the event of a disaster. It is important to any company that uses it Information Systems to generate revenue. If a company is effected by a disaster, the longer a company takes to respond to the emergency and recover its resources, the more time it will take the company to get back to normal operations (Harris, 2013, p. 887). As history has shown, our world has and will continue to experience many destructive events such as, floods, earthquakes, terrorism, hurricanes, and many other catastrophic events that could cripple a company that is not prepared. Disasters are uncontrollable and over time, every organization will have to deal with the fallout of a disaster. Three...
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...Budgeting and Variance Analysis TJ Wicker TJ Wicker Kaplan University Chapter 8 Question 8.1 Why are planning and budgeting so important to an organization’s success? Planning and budgeting both play a critical role in the finance functions of all healthcare service organizations. In fact, on could argue (and usually win the argument) the planning and budgeting are the most importnat of all finance related tasks. Planning encompasses the overall process of preparing for the future. Because of tis’ importance to organizational success, most health services managers, especially at large organizations, spend a great deal of time on a=activities related to planning. Budgeting is an offshoot of the planning process. A set of budgets is the basic managerial accounting tool used to tie together planning and control functions. In general, organizational plans focus on the long-term big picture, and through the control mechanism, ensuring that current performance is consistent with organizational plans and goals. Question 8.2 Briefly describe the planning process. Be sure to include summaries of the strategic, operating and financial plans. 1. Goal setting: Plans are the means to achieve certain ends or objectives. Therefore, establishment of organizational or overall objectives is the first step in planning. Setting objectives is the most crucial part of planning. The organizational objectives should be set in key areas of operations. The objectives must be clear, specific...
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...Management Planning National Beverage Corp University of Phoenix MGT/330 Jacqueline Lester December 20, 2010 National Beverage Corp is a regional bottling company located in the United States. Some of their products are Shasta, Faygo, Ohana, and Everfresh. National Beverage Corp’s products are available at convenience stores, supermarkets, and other retail stores. The company has a management planning function that is affected by ethical policies, social responsibility, legal issues, and many other factors. The meaning of ethical conduct is not completely clear in the business world. In numerous cases, business philosophy says that people should conduct themselves in a manner above criticism. It is very important that all employees of National Beverage Corp conduct their business affairs in an appropriate behavior. Ethical conduct is essential to ensure triumphant, continued business relations. The laws of National Beverage Corp are observed to make sure that they have the highest ethical standards. If a person is uncertain about a problem, it is very important to seek help. The problem is discussed with management, and then it is resolved. The business conduct policy is not always built on hard set rules but instead offers some common sense used in day-to-day business life. NBC employees are informed that they have to be aware of anything that could cause them to engage in unethical actions...
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...administration and compliance with associated government regulation. What is Human Resource Planning? According to Brighthub.com, “Human Resource Planning” is a systematic analysis of HR needs to ensure the availability of the correct number of employees with the necessary skills at the right time. The increased competitive nature of business that makes workforce flexibility an imperative need has raised the importance of human resource planning. Effective Human Resource planning entitles five main steps. These steps include: 1. Demand Forecasting 2. Supply Forecasting 3. Audit 4. Reconciliation Or Affecting A Demand-Supply Fit 5. Control. Demand Forecasting This is a process of determining future needs for Human Resource in terms of quantity and quality. It is done to meet the future personnel requirements of the organization to achieve the desired level of output. Demand Forecasting requires a good understanding of the internal and external environment of the enterprise. Short-term and long-term organizational plans and strategies are the major aspects of the internal environment that affect HR Planning, while on the other hand, the general status of the economy, developments in technology, level of competition, labor market trends and regulations, demographic trends are the major aspects of an enterprise’s external environment that impacts HR planning. There are two main methods of forecasting. These include: Delphi technique/ managerial estimates...
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...Leitax 2004 Leitax 2004 Analysis of the new forecasting process Analysis of the new forecasting process Assignment questions 1. Based on the description of planning system before the Redesign Project which function or individuals should be held responsible for the planning problems in FY 2002? In FY 2004? In 2002, Leitax had suffered through poor planning of 3 camera models: the launch of one camera delayed (cost: $19.5 million), another outsold its inventory (costs: $4.5million) and a third model reported sluggish sales ($2.5million). To compensate, Leitax extended the life of an existing model and made a mad scramble to find product and customers but the most costumers preferred to wait for the delayed camera. These events reflect the failure to manage the planning and the operational efficiency. The problem was general because groups did not communicate between them and if the operator group disagreed with the financial group, each group did its own forecasts => lack of cooperation and coordination. These departments should be held responsible largely for the planning problems because they did not perform their job well enough: -Marketing Department: This department should study and evaluate the market trend. -Sales Department: This department is very close to the customers. So, they know the feedback and customer behavior towards the products and can carry on information to another relevant departments to project the sales forecast. -Production...
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...Posh Garments Ltd.. Industrial Engineer/ Manager, IE Job Description / Responsibility A Well Reputed 100% Export Oriented Group Sr. Manager/ Manager - Planning (Bottom Division) Job Description / Responsibility * Line loading in Fast React. * Lead a team of Planners. * Target fixing based on capacity factor & efficiency or other parameters. * Monitor & plan Sewing production to meet the shipment requirement of the Company. * To follow up production target of the line wise production plan. * Make Time & Action Plan to have hard look on daily progress report & co-ordinate accordingly. * Monitoring the Daily production Reports with updated figure to know the production at a glance. * Prepare daily problem report & action plan against the problem, take proper step to solve them. * Any other task assigned by management Fakir Fashion Ltd. Sr. Manager (IPE) Job Description / Responsibility * Responsible for planning, developing and implementing allover IE & WS activities in all departments. * Setting IE team and ensuring that the targets are achieved. * Review the current policies and improve plans to improve upon the existing standards. * Setting up and maintaining controls and documentation procedures. * Prepare operation bulletin machine / line layout. * Do method / Motion / Time study in line for each style. * Capacity study of line for setting standards targets and line balancing. * Monitor the...
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...It was recognized early in the development of the ICS that the critical factor of adequate planning for incident operations was often overlooked or not given enough emphasis. This resulted in poor use of resource, inappropriate strategies and tactics, safety problems, higher incident costs, and lower effectiveness. Planning involves evaluating the situation, developing incident objectives, selecting a strategy, and deciding which resources should be used to achieve the objectives in the safest, most efficient and cost-effective manner. The primary phases of the planning process are essentially the same for the Incident Commander who develops the initial plan. For the Incident Commander and Operations Section Chief revising the initial plan for extended operations, and for the incident management team developing a formal IAP, each following a similar process. During the initial stages of incident management , planners must develop a simple plan that can be communicated through concise verbal briefings. Frequently, this plan must be developed very quickly and with incomplete situation information. As the incident management effort evolves over time, additional lead time, staff, information system, and technologies enable more detailed planning and cataloging of events and lesson learned. In my opinion the planning process is the most helpful in the Subdivisions of the ICS chart. During any incident it is important to always have something planned before anything ever happens...
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...many to take the view that forecasting is neither useful nor necessary (Taylor 2010). Forecasting is a key aspect of Human Resource Planning (HRP); which can be a complex process especially during periods of economic uncertainty and fluctuation. This intensifies the pressures between the need for planning and the difficulties of prediction. Nevertheless, the fundamental purpose is simple: HRP is concerned with assessing and meeting an organisation’s current and future workforce needs. This ensures the right number of people with the appropriate skills and competencies are in the right jobs at the right time and at the right cost so as to achieve organisational objectives (Foot and Hook 2005). In presenting a balanced view, this essay will analyse the argument for and against HRP in determining if it is unfeasible for organisations to accurately forecast the demand for and supply of labour. Furthermore, how HRP can inform other Human Resource (HR) activities such as recruitment and selection (R&S), succession planning, performance management and training and development amongst others. Specific reference where appropriate will be demonstrated to showcase links between theoretical and practical context. Forecasting as a key element of HRP As organisations continue to evolve and become more dynamic, it can be argued that effective planning of its most important resource (its workforce) in achieving strategic goals has never been more important. Organisations can achieve...
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...MGT/230_ Wk3_Management Planning MGT/230 April 15, 2013 Management Planning As today’s leading energy company, British Petroleum, PLC (BP) has been thriving to satisfy the investors with legal, ethical, and social responsibility issues as a corporation while protecting employees and environment. The global economy has been fluctuating rapidly since the last tragic incident that happened in 2010; therefore, now is the time to evaluate the organization’s management planning function, analyze the influence that have had on management planning at BP, and analyze the factors that influence the company’s strategic, tactical, operational and contingency planning. Planning Function of Management The board of directors have played valuable role in both planning and decision making process at BP since the incident in 2010. Although BP had fully engaged to solve the issues from the incident by using top level skills and taking appropriate measures, the lesson BP learned was, in such a painful manner, that there are substantial financial risk accompany poor decisions and planning which was losing $30 billion, according to Marianne M. Jennings (Jennings, 2010). Therefore, BP plc is adopting a new basic planning process that was introduced by Bateman and Snell: situational analysis, alternative goals and plans, goal and plan evaluation, goal and plan selection, implementation, and monitor and control that moves not just in one direction, but in a cycle (Bateman & Snell...
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...Sparkling Glass Limited (SGL) is a medium scale glass container manufacturing unit. For the last two years SGL has made losses because of increasing cost of production. But this year it is expected to make profits. The reasons for high cost of production have been government policies, wage agreements and sales cartels which control the inputs. This report serves as the decision support document for the selection committee appointed to find the replacement of Mr. Ashok, the General-shift-in-charge who is slated to retire in few months. Purpose Mr. Prasad, the Plant Superintendent wants to find the replacement for Mr. Ashok. Four shift-in-charges, viz. Mr. Khanna, Mr. Punjabi, Mr. Gupta and Mr. Gulati are in contention for the job. The other options available are recruitment of a new person and extension of Mr. Ashok’s tenure. The decision tree for the given case is as follows: Options Available Among the possible options, the recruitment of a new person from another company might infuse new unbiased ideas. However, the following risks outweigh the benefit of recruiting a new person: • Possibility of friction with the existing shift-in-charges: The incumbent shift-in-charges may take some time to accept the newcomer to the company and vice versa and the difference in opinions of both the parties may create some conflict. • High cost implication: SGL has suffered losses for the last two years and wants to earn profits this year. In such a situation, hiring someone new from another...
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...important ways is to assess the product's success in domestic markets. If a company succeeds at selling in a domestic market, there is a good chance that it will also be successful in markets abroad, wherever similar needs and conditions exist. In markets that differ significantly from the domestic market, some products may have limited potential. Those differences may be climate and environmental factors, social and cultural factors, local availability of raw materials or product alternatives, lower wage costs, lower purchasing power, the availability of foreign exchange (hard currencies like the dollar, the British pound, and the Japanese yen), government import controls, and many other factors. If a product is successful in a domestic market, one strategy for export success may be a careful analysis of why it sells here, followed by a selection of similar markets abroad. In this way, little or no product modification is required. If a product is not new or unique, low-cost market research may already be available to help assess its overseas market potential. In addition, international trade statistics (available in many local libraries) can give a preliminary indication of overseas markets for a particular product by showing where similar or related products are already being sold in significant quantities. If a product is unique or has important features that are hard to duplicate abroad, chances are good for finding an export market. For a unique product, competition may be...
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...Managerial accounting is concerned with providing information to managers-that is, people inside an organization who direct and control its operation. In contrast, financial accounting is concerned with providing information to stockholders, creditors, and others who are outside an organization. Managerial accounting provides the essential data with which the organizations are actually run. Managerial accounting is also termed as management accounting or cost accounting. Financial accounting provides the scorecard by which a company's overall past performance is judged by outsiders. Managerial accountants prepare a variety of reports. Some reports focus on how well managers or business units have performed-comparing actual results to plans and to benchmarks. Some reports provide timely, frequent updates on key indicators such as orders received, order backlog, capacity utilization, and sales. Other analytical reports are prepared as needed to investigate specific problems such as a decline in the profitability of a product line. And yet other reports analyze a developing business situation or opportunity. In contrast, financial accounting is oriented toward producing a limited set of specific prescribed annual and quarterly financial statements in accordance with Generally Accepted Accounting Principles (GAAP). (Ray H. Garrison Eric W Noreen 1999). Managerial accounting is managers oriented therefore its study must be preceded by some understanding of what managers do, the...
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