Assignment 2: Resource and Time Budgets

Assignment 2: Resource and Time Budgets
Using your textbook, read the Directed Reading entitled “Three
Perceptions of Project Cost.”
Based on your research and reading, answer the following
questions:
·
What are the
differences in the ways project managers, accountants, and financial
comptrollers perceive the expenses of a project?
·
How are indirect
costs involved in the preparation of the budget for a project?
·
Using the
typical profit and loss statement included in the Directed Reading, does it surprise
you that a $1,000,000 project will generate only the Net profit shown on the
bottom line of that statement? Why or why not?
You are going to be the project manager for the construction of a large
warehouse for a major international company. Of course, there are many
elements involved in constructing such a large facility, but this assignment
will consider only one, the laying of the facility’s foundation (which is
obviously preceded by site preparation and followed by the actual construction
of the building).
In preparation for completing of this element of the project—laying the
facility foundation—complete the following:
·
Locate a source
of data for the hourly wages that will need to be paid to those who will pour
and finish the concrete foundation (the Bureau of Labor Statistics of the
United States government is a good source for such information). Be sure
to document the source of your hourly wage data for such concrete
workers.
·
Locate a source
of data for the cost of a cubic yard of reinforced concrete. Be
sure to document the source of your reinforced concrete cost data.
·
Assuming that
eight workers will be needed for the completion of the project, that they will
work five days per week for 10 hours per day, and that it will take them three
full weeks to complete the pouring of the foundation, what is your estimate
(based on the hourly wage data that you located) of the labor expense of
pouring the foundation?
·
Assuming that
the foundation will require 400 cubic yards of concrete, what is your estimate
(based on the hourly wage data that you located) of the cost of the materials
needed for pouring the foundation?
·
How would
“Overhead charges” (review the Budgeting chapter if you do not remember
learning about this term) impact the two estimates that you have
calculated?
·
How would an
increase in the cost of steel (one of the components of reinforced concrete)
impact the budget that you had developed?
·
If the
construction site was impacted by a hurricane during the preparation of the foundation
(meaning that work had to be temporarily stopped), how would the overall
schedule of the construction project be impacted?