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Cost Estimation - Problem Solving Tutorial

The document provides information to estimate the cost of a construction project including: - Cost estimates are provided for masonry work including material and labor costs over 40 days. The total direct cost is estimated at 252,717 EGP. - Hourly crew costs are calculated for carpenters and laborers including wages, benefits, taxes. The average hourly cost of the crew is estimated at 105 LE/hr. - To estimate the cost and duration of concrete work using a pump over 16 hours per day. The total cost is estimated at 566,465 LE over 5 days. - Time and location cost indices are provided to estimate the cost of a building with 42,500 sqm of

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Mahmoud Ibrahim
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3K views5 pages

Cost Estimation - Problem Solving Tutorial

The document provides information to estimate the cost of a construction project including: - Cost estimates are provided for masonry work including material and labor costs over 40 days. The total direct cost is estimated at 252,717 EGP. - Hourly crew costs are calculated for carpenters and laborers including wages, benefits, taxes. The average hourly cost of the crew is estimated at 105 LE/hr. - To estimate the cost and duration of concrete work using a pump over 16 hours per day. The total cost is estimated at 566,465 LE over 5 days. - Time and location cost indices are provided to estimate the cost of a building with 42,500 sqm of

Uploaded by

Mahmoud Ibrahim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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18CEM10I Construction Quantity Surveying, Estimation and S2 –2018/2019

Specifications

Cost Estimation-Tutorial
 Problem Set # 1

 A bill of quantity of a project includes 2800 m2 of masonry work. The work will be done by one
crew with a production rate of 70 m2 /day and consists of:

Crew member No. Cost /Day/One


Brick layer 3 200
Assistant 2 150
Labor 1 110

 Vendor price of 1000 bricks = LE 650. Each 80 bricks are estimated to make one square meter of
masonry. Each one cubic meter of mortar is used to join brick area of 50 m2 and consists of:

Quantity Material Primary quotation from vendor


One cubic meter Sand 75
7 sacks (50 kg each) Cement 1200

 As a contractor, it is required to estimate the item Total Direct Cost and the Unit Direct Cost.
Assume all material waste as 22.5 %.

Answer

Duration of Masonry works = 2800 m2 / 70 m2 per day = 40 days

Material Costs

Number of Masonry bricks required = 80 brick x 2800 = 224,000 Masonry Brick

Consider material waste as 22.5 %, then Number of Masonry bricks required = 224,000 x1.225= 274,400
brick

Total cost of bricks = (274,400 /1000) x 650 = 178,360 EGP

Total cost of mortar:

Sand = 75 EGP/m3 x (2800/50) = 4,200 EGP*1.225 = 5,145 EGP

Cement = 1,200 EGP/ton x (7 / 20) x 56 = 23,520 EGP*1.225 = 28,812 EGP

Total cost of materials = 178,360+ 5,145+28,812 = 212,317 EGP


18CEM10I Construction Quantity Surveying, Estimation and S2 –2018/2019
Specifications

Manpower Costs

Bricks layer = 3 x 200 x 40 = 24,000 EGP

Assistant cost = 2 x 150 x 40 = 12,000 EGP

Labor cost = 1 x 110 x 40 = 4,400 EGP

Total cost of Manpower = 24,000 + 12,000 +4,400 = 40,400 EGP

Total Direct Cost = 212,317 + 40,400 = 252,717 EGP

Unit Direct Cost = 252,717 EGP / 2800 m2 = 91 EGP / m2

 Problem Set # 2

 A crew of four carpenters and three semi-skilled labors is used to install the formwork for a concrete
structure. Work is scheduled for 12 hr/day on Sunday through Wednesday and 10 hr on Thursday.
A base salary is paid for all straight-time work, 8 hr/day, 4 day/week (Sunday to Wednesday).
Overtime at a rate of one and one-half will be paid for all hours over 8 hr/day during the week and
double time for all Thursday work. The base wage, taxes and insurance rates are given in the table
1 below. Calculate the average hourly cost of the carpenter crew.

Table 1
Item 4 Carpenters 3 Semi Skilled Labors Notes
Base wage LE 30 /hr LE 22/ hr
Worker’s
LE 32/LE100 LE 20/LE100 of base wage
compensation
Social security 16.5 % 12.5 % of actual wage
Unemployment
7% 4.6 % of actual wage
insurance
Actual working
Benefits LE 4/ hr LE 5/ hr
hour

Answer

 Actual working hours = (12× 4)+(10x1) = 58 hr/week


 Pay hours = weekly straight time + weekly overtime + Thursday overtime = (4 × 8 × 1 ) + (4 × 4 ×
1.5) + (10× 2) = 76 hr
 4 Carpenters
 Average hourly pay = (76/58) × 30 LE = 39.3 LE/hr
 Work Compensation = 32/100 × 30 = 9.6 LE/hr
18CEM10I Construction Quantity Surveying, Estimation and S2 –2018/2019
Specifications

 Social Security = 39.3 x 0.165 = 6.5 LE/hr


 Unemployment = 39.3 x 0.07 = 2.75 LE/hr
Then, the average hourly cost = LE 58.15/hr + LE 4/hr = LE 62.15/hr

 3 Semi Skilled Labors


 Average hourly pay = (76/58) × 22 LE = 28.8 LE/hr
 Work Compensation = 20/100 × 22 = 4.4 LE/hr
 Social Security = 28.8 x 0.125 = 3.6 LE/hr
 Unemployment = 28.8 x 0.046 = 1.3 LE/hr
Then, the average hourly cost = LE 38 /hr + LE 5/hr = LE 43/hr

The average hourly cost of the steel fixer crew= 43+62.15= 105 LE/hr

 Problem Set # 3

 A subcontractor is currently preparing an estimate for a new concreting job in which he


has to pour 1350 cubic meter of concrete using concrete pumps. A normal working day is
8 hr/day. The rate for the labor overtime per hour is considered to be 1.85 X normal rate.
The crew production during an overtime hour is 83% of their production in a regular hour.
The subcontractor has to use Md2 method of construction.
 It is required to calculate the total cost and duration.

Labor
Code Description Rate/hr
L1 General Labor 25
L4 Concrete Worker 45
Equipment
Code Description Rental / hr Operation/hr
E2 Tran mixer 60 20
E14 Pump 120 12

Crews
Code Description Unit Composition
C16 Concrete Crew M3 2 L1+3 L4+1
E2+1 E14

Materials
Code Description Unit Cost/unit
M12 Ready Mix Concrete M3 350
18CEM10I Construction Quantity Surveying, Estimation and S2 –2018/2019
Specifications

Code Description Unit Resource Production/ Notes


day
Md-1 Concreting by M3 C16+M12 165 Normal
pump (8hr/day) Hours
Md-2 Concreting by M3 C16+M12 ? 8 hr Over
pump (16 Time
hr/day)

Answer

 One of crew C16 and one of M12 are used under a 16-hour day (8 overtime hours). The
daily costs relate to the crew hourly rates and the amount of material needed for the
production
 Production per day = 165 for normal working hours + (0.83 x 165 / 8) x 8 for overtime =
301.95 m3 /day
 Duration = Quantity / Production per day = 1350 / 301.95 = 4.47= 5 days.
Total Cost = Duration (days) x Cost per day

 = 5 days x (daily cost of crew C16 + cost of 301.95 M12 material)


 = 2L1 x L.E 25 (8 + 1.85 x 8) = (L.E 1,140) + 3L4 x L.E 45 (8 + 1.85 x 8) = L.E 3,078 =
4,218 / day
 1E2 x (L.E 60 + 20) x 16 = L.E 1,280 /day
 1E14 x (L.E120 + 12) x 16 = L.E 2,112/day
 301.95 (M12) x L.E 350 = L.E 105,683
= 5 x (4,218+ 3,392 + 105,683) = L.E 566,465

 Problem Set # 4
 Use the time and location indices shown below in tables1, and 2 to estimate the cost of a
building that includes 42500 m2 of floor area. The building is to be constructed 2 years
from now in City A. The cost of a similar type of building that included 48300 m2 was
completed last year in City C for a cost of LE 3,308,500.

Table 1. Construction economic trends


Year Index
3 years ago 358
2 years ago 359
1 years ago 367
Current year 378
18CEM10I Construction Quantity Surveying, Estimation and S2 –2018/2019
Specifications

Table 2. Locations cost indices


Location Index
City A 1.025
City B 1.170
City C 1.260
City D 1.105
City E 1.240

Answer

The equivalent interest rate can be calculated based on the change in the cost index during the 3-
year period as follow:

(378/358) = (1+i) n = (1 + i)3, then i = 1.83%

Proposed cost = Previous cost × Time adjustment × Location adjustment × Size adjustment

= 3,308,500 LE × (1 + 0.0183)3 × (1.025 / 1.260) × (42,500 / 48,300) = 2,500,652 LE

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