Chapter 1- Cost Estimation:
Cost Estimation sheet is very important in cost control. However, it is a very straight forward process. I will
deride the above table into two parts so it will be easy to read.
1- Cost estimation sheet part 1
- BOQ Ref: This is a unique number to each bill of Quantity BOQ item.
- BOQ Name: This is the description of each item in the BOQ
- BOQ Unit: This is the unit of measurement in the BOQ
- BOQ QTY: This is the quantity of each item in your BOQ
- BOQ Unit Rate: This is the price for each unit.
- selling price: This is the price of BOQ item as you will be paid from the client = quantity * unit rate.
- Budget Materials Costs: the cost of materials for this item.
How to calculate it? simply find out the required materials for this item, calculate the quantity of each
material and multiply by the cost of the material.
Example: calculate the materials cost for isolated footings:
a) Concrete materials = 100 m3 (Qty) * 10 (price of m3) = 1, 000$
b) Reinforcement steel = 10 ton * 200 = 2,000 $
c) water for treatment = 2 m3 * I = 2 $
Total materials costs = I, 000 + 2,000 + 2 = 3,002 $
Course link: https://planningengineer.net/lp-courses/cost-control-for-construction-projects
- Budget Labor costs: this is the cost of direct manpower to execute the works. Direct manpower does not
include the supervision team such as Engineers & Foreman
How to calculate? very simple, find out how many hours are required to execute one
unit of the item, multiply by the quantity of the item, and then multiply by the hour rate.
Example: calculate the labor cost for isolated footings:
a) form works = 100 m3 (Qty) * 1 (hour per m3) * 10 (hourly rate of labor) = 1, 000$
b) steel works = 10 ton * 4 (hour per ton) * 10 (hourly rate of labor) = 400 $
c) pouring and treatment = 100 m3 (Qty) * 0.1 (hour per m3) * 10 (hourly rate of labor) = 100$
Total labor costs = I, 000 + 400 + 100 = 1,500 $
- Budget equipment costs: The cost of the equipment involved in this item.
How to calculate? very simple, find out how many hours are required to execute one
unit of the item, multiply by the quantity of the item, and then multiply by the hour rate.
Example: calculate the equipment cost for isolated footings:
a) vibrator = 100 m3 (Qty) * 0.01 (hour per m3) * 10 (hourly rate of labor) = 10$
Total equipment costs = I0 $
- Budget subcontractor costs: the costs of any subcontractors involved in this item.
How to calculate? Assume you decided to subcontract the workmanship of the
isolated footings. In this case, you remove the cost of the labors and add the cost of
the subcontractors,
Example: calculate the subcontractor's cost for isolated footings:
a) form works = 100 m3 (Qty) * 10 (subcontractor unit rate per m3) = 1,000$
b) steel works = 10 ton * 40 (subcontractor unit rate per ton) = 400$
c) pouring and treatment = 100 m3 (Qty) * 1 (subcontractor unit rate per m3) = 100$
Total subcontractors costs = 1,000 + 400 + 100 = 1,500 $
Course link: https://planningengineer.net/lp-courses/cost-control-for-construction-projects
BOQ Item
1
Materials labors equipment subcontractor
Steel Form works Form works
Vibrator
Concrete Steel works Steel works
Water Pouring Pouring
concrete concrete
Do not duplicate
2- Cost estimation sheet part 2
Course link: https://planningengineer.net/lp-courses/cost-control-for-construction-projects
- Total direct costs: This is a simple column equals the costs of materials, labor, equipment, and subcontractors
Materialspaymentterms this columndefineswhen the contractor will
- Materials payment terms: this column defines when the contractor will pay after purchasing the materials. This
pay after comes to calculatethe
is very useful when itpurchasing
materials
the project cash in andThis
out. is veryusefulwhen itcomes
to calculate the projectcash in andout
- Labors payment terms: this column defines when the contractor will pay the labors. This is very useful when it
comes to calculate the project cash in and out.
- Equipment payment terms: this column defines when the contractor will pay the equipments. This is very useful
when it comes to calculate the project cash in and out.
- Subcontractors payment terms: this column defines when the contractor will pay the subcontractors. This is
very useful when it comes to calculate the project cash in and out.
- Project ID: is a unique number to define each project. This is useful to filter the costs by project later on.
- Div ID: is a unique number to define the standard division of works. This is useful to filter the costs by
Division later on.
Course link: https://planningengineer.net/lp-courses/cost-control-for-construction-projects
