Exam Reviewer for "CE 416 – Construction Cost Engineering" Report

Group 3

I. Introduction

 Definition and Importance:

o Planning: Refers to the overarching framework, including defining objectives, resources,

and strategies for project execution.

o Scheduling: A subset of planning focused on timing and sequencing of project activities

to ensure timely completion.

o Key Insight: Scheduling begins when project details are set, and computations on project
duration are conducted.

II. Cost Planning

 Definition: A structured approach to estimating and controlling costs for project components like
materials, labor, and equipment.

 Stages:

1. Concept Design Stage: Initial estimates based on basic project specifications.

2. Detailed Design Stage: Refinement of estimates as design progresses.

3. Tender Stage: Updates to include contractor pricing after contracts are awarded.

4. Construction Stage: Continuous updates to compare actual costs with estimates.

 Importance:

o Facilitates budget management and proactive risk mitigation.

o Enables informed decision-making based on financial feasibility.

III. Project Scheduling

 Definition: A structured timetable that organizes tasks, timelines, and resources.

 Components:

o Timeline with start/end dates and milestones.

o Task deliverables and dependencies.

o Resource and cost allocation.

o Assigned responsibilities.

 Why Schedule?
 o Contractors: Determine completion dates, optimize cash flow, improve efficiency, and
substantiate delay claims.

o Owners: Assess feasibility, monitor progress, verify delays, and ensure timely financial
management.

 Key Role: The Scheduler, who requires expertise in software, scheduling principles, and the
technical field.

Types of Schedules

1. Bar Chart (Gantt Chart):

o Visual representation of tasks over time.

o Tracks start/end dates, man-hours, budgets, and progress.

2. Critical Path Method (CPM):

o Identifies the longest task sequence (critical path) to determine project duration.

o Key Components:

 Earliest/Late start and finish times.

 Slack or float (allowable delays).

o Diagrams: Activity on Arrow (AOA) and Activity on Node (AON).

3. Program Evaluation and Review Technique (PERT):

o Probabilistic method using optimistic, most likely, and pessimistic time estimates to
calculate expected durations.

o Applications: Determines completion probabilities and dates with specified confidence

levels.

IV. Materials Cost Scheduling

 Definition: Process of estimating, planning, and managing material costs to align with project
timelines and budgets.

 Benefits:

o Improved budget control and cash flow management.

o Risk mitigation against market fluctuations.

o Efficient resource allocation and reduced material waste.

 Factors:

o Accurate scope and material needs.

o Monitoring market trends and price fluctuations.

 o Supplier reliability and logistical considerations.

V. Conclusion and Recommendations

 Conclusion:

o Effective planning and scheduling are critical for timely and cost-efficient project
execution.

o Integration of cost planning and materials scheduling minimizes risks and enhances
decision-making.

 Recommendations:

o Use project scheduling software and CPM/PERT methods for real-time adjustments.

o Maintain robust collaboration among stakeholders.

o Include contingency funds to address unforeseen issues.

Group 4

I. Introduction

 Key Themes:

o Estimating and scheduling are vital for project success, ensuring cost-effectiveness and
timely completion.

o Precision in estimates and effective scheduling prevent project delays, budget overruns,
and quality issues.

 Benefits of Scheduling:

o Time Management: Ensures timely task completion.

o Coordination: Aligns teams and prevents resource conflicts.

o Quality Assurance: Allocates adequate time for each task.

o Client Communication: Provides a clear project timeline, fostering trust.

II. Manpower Scheduling

 Definition:

o Process of assigning specific tasks to skilled workers for efficient and safe execution.

 Key Features:

o Prevents idle time, excessive overtime, and cost overruns.

 o Evaluates workspace density to avoid overcrowding and safety issues.

 Best Practices:

o Created by site managers who understand team strengths.

o Over-schedule tasks by at least 15% to prevent interruptions.

 Importance:

o Optimizes labor costs, reduces turnover, and increases productivity.

III. Subcontractor Cost Scheduling

 Definition:

o Managing costs for subcontracted services, including labor, materials, and equipment.

 Components:

o Labor, material, and equipment costs; overhead expenses.

 Benefits:

o Access to expertise, flexibility, and risk transfer.

 Best Practices:

o Use detailed contracts specifying scope, costs, and timelines.

o Monitor subcontractor performance and budget adherence.

o Understand and negotiate critical contract clauses (e.g., delays, changes, force majeure).

 Challenges:

o Risks increase with restrictive contracts.

o Must align subcontractor schedules with the master project plan.

IV. Equipment Cost Scheduling

 Definition:

o Estimating and budgeting costs associated with equipment use, including purchase,
rental, and maintenance.

 Importance:

o Ensures cost-effectiveness without compromising quality.

o Helps manage expenses like fuel, transportation, and storage.

  Flowchart Overview:

1. Identify equipment needs and specifications.

2. Estimate acquisition costs.

3. Secure approvals and funding.

4. Procure and install equipment.

5. Schedule and budget for maintenance.

6. Dispose of outdated equipment.

 Key Users:

o Project managers, cost accountants, maintenance technicians.

V. Scheduling Tools and Techniques

 Steps in Scheduling:

1. Develop a Work Breakdown Structure (WBS):

 Organizes tasks hierarchically for clarity and responsibility assignment.

2. Sequence Activities:

 Use dependency types like Finish-to-Start or Start-to-Finish.

 Tools: Gantt Charts, CPM, Network Diagrams.

3. Estimate Activity Durations:

 Methods: Historical data, expert judgment, or three-point estimation.

4. Develop the Schedule:

 Use tools like PERT, Gantt Charts, and Network Diagrams.

5. Allocate Resources:

 Avoid conflicts and ensure resource efficiency.

6. Monitor and Control Progress:

 Techniques: Progress tracking, variance analysis, EVM.

VI. Conclusion

 Key Takeaways:

o Scheduling ensures timely, cost-effective, and quality-compliant project execution.

 o Manpower scheduling enhances efficiency and task tracking.

o Subcontractor and equipment cost scheduling ensure budget control and resource
optimization.

 Critical Insight:

o Without proper scheduling and monitoring, projects face chaos and inefficiency.

VII. Recommendations

1. Prepare comprehensive and detailed plans before starting.

2. Regularly monitor and update schedules at every project phase.

3. Ensure thorough planning for manpower, subcontractor, and equipment costs.

4. Use modern tools like scheduling software for better management.

Group 5

I. Introduction

 Definition:

o Cash flow represents the movement of money into and out of a construction project
during a specified period.

o Effective cash flow management ensures financial stability and uninterrupted project
operations.

 Key Components:

o Tracking inflows and outflows.

o Timely payments to maintain supplier and subcontractor relationships.

o Budgeting, forecasting, and contingency planning to handle financial uncertainties.

II. Preparing Cash Flow Projections

 Definition:

o A cash flow projection forecasts the expected cash inflows and outflows for a project
over time, helping predict future financial needs.

 Steps to Calculate Cash Flow Projections:

1. Start with Total Project Budget: Use the total cost of the project as the base.
 2. Identify Job Costs to Date: Sum up the actual expenditures already made.

3. Calculate Remaining Costs:

 Projected Cost to Complete=Total Budget−Job Costs to Date\text{Projected Cost

to Complete} = \text{Total Budget} - \text{Job Costs to
Date}Projected Cost to Complete=Total Budget−Job Costs to Date

4. Allocate Remaining Budget Across the Schedule: Distribute projected costs over the
timeline of the project.

5. Apply Curves:

 Use curves like bell-shaped, linear, front-loaded, or back-loaded to match

expenditures to project milestones.

 Best Practices:

o Prepare reports at various levels (trade, project, portfolio) for granular insights.

o Align projections with the project schedule and scope.

o Regularly update projections to reflect changing circumstances.

o Use integrated software to streamline tracking and enhance accuracy.

III. Cash Flow Assumptions

 Significance:

o Assumptions underpin forecasting models and impact project viability.

o Accurate assumptions help mitigate risks such as shortages or surpluses.

 Key Factors:

o Financing Costs: Include precise interest calculations to avoid underestimating expenses.

o Building Information Modeling (BIM): Leverage BIM for automated integration of time
and cost data.

o Risk Management: Analyze potential impacts of material cost fluctuations, delays, and
inaccuracies in measurements.

 Practical Guidelines:

1. Dynamic Forecasting Models: Use time-series models to reduce transaction costs.

2. Cash Flow Distributions: Align with market conditions and avoid over-restrictive
assumptions.

3. Risk Sensitivity Analysis: Assess the impact of uncertainties to refine forecasts.

IV. Cash Flow Projections vs. Forecasting

Aspect Projection Forecasting

Estimates future inflows/outflows using historical Uses current data to predict short-term
Definition
data and assumptions. cash movements.

Purpose Long-term planning and budgeting. Short-term decision-making.

Time
Longer periods (months/years). Shorter periods (weekly/monthly).
Horizon

Frequency Less frequent updates. Frequent updates.

Tools Historical data and financial modeling. Real-time data and predictive analytics.

V. Cash Receipts

 Definition:

o Cash receipts document the inflow of cash from customers, boosting the company’s cash
balance.

 Examples:

o Fees from services (e.g., lawyer fees).

o Sales of goods at cash registers.

o Refundable deposits or ticket returns.

 Recording Cash Receipts:

o Debit the accounts receiving cash (e.g., inventory, accounts receivable).

o Credit cash for an increase in the cash balance.

VI. Conclusion

 Key Takeaways:

o Effective cash flow management is essential for the success of construction projects.

o Cash flow projections aid in anticipating financial needs, aligning funding strategies, and
ensuring timely resource availability.

o Incorporating risk analysis and leveraging modern tools like BIM enhances accuracy and
adaptability.
VII. Recommendations

1. Training: Provide project managers with training in cash flow management techniques.

2. Technology Integration: Use project management software for real-time cash flow tracking.

3. Regular Updates: Establish routine reviews to adjust projections based on changing project
dynamics.

4. Risk Integration: Account for potential uncertainties in cost and schedule.

5. Enhanced Communication: Maintain clear cash flow expectations among stakeholders.

6. Variance Monitoring: Track differences between projected and actual cash flow to refine future
forecasts.

7. Contingency Planning: Prepare for financial challenges with alternative funding or payment
strategies.

Group 6

Reviewer for Construction Cost Engineering

1. Overview of Construction Cost Engineering

 Focuses on planning, estimating, and managing costs in construction projects.

 Covers all project phases: conceptualization, design, execution, and post-completion.

 Includes direct costs (materials, labor) and indirect costs (administrative, pre-operating).

2. Capital Investment

 Definition: Funds required to initiate and complete a project, covering land, materials, labor, and
equipment.

 Importance: Ensures project viability, attracts investors, and supports long-term asset creation.

 Types of Capital Investment:

o Fixed Capital: Long-term assets like land, buildings, machinery.

o Working Capital: Short-term financial resources for daily operations.

 Calculation Example:

o Land: $400,000

o Equipment: $150,000
 o Working Capital: $75,000

o Total Capital Investment: $625,000

3. Loans and Interest Payments

 Understanding Construction Loans:

o Short-term, high-interest loans for construction projects.

o Disbursed in phases (draws) as work progresses.

o Types include construction-to-permanent, construction-only, renovation loans.

 Qualifying for a Loan:

o Requires good credit, income verification, and a detailed project budget.

 Interest Payments:

o Fixed vs. Variable Rates.

o Interest-only payments during construction to reduce initial cash outflows.

 Example Calculation:

o Principal: $100,000

o Annual Interest Rate: 5%

o Term: 5 years

o Monthly Payment: $1,887.12

o Total Payment Over 5 Years: $113,227.20

4. Pre-operating Costs

 Definition: Costs incurred before the project starts, such as feasibility studies, permits, and
licenses.

 Types:

o Fixed Costs: Legal services, facility costs.

o Variable Costs: Raw materials, marketing.

o Semi-variable Costs: Overtime labor, consulting fees.

 Importance:

o Helps in financial planning and ensures regulatory compliance.

5. Administrative Costs

 Definition: Costs not tied directly to physical construction but essential for project management.

 Examples:

o Salaries and wages for managers and staff.

o Office expenses, utilities, communication.

o Insurance, legal fees, training costs.

 Importance:

o Ensures project coordination and compliance.

o Supports risk management and resource allocation.

6. Impacts of Costs on Cash Flow

 Loans:

o Enable project initiation but increase total costs due to interest.

o Regular repayments impact financial flexibility.

 Pre-operating and Administrative Costs:

o If underestimated, they lead to budget overruns.

o Accurate estimation prevents delays and ensures smooth execution.

7. Conclusion and Recommendations

 Capital investment, loan selection, and cost management are vital.

 Recommendations:

o Detailed financial planning with contingencies.

o Strategic loan selection based on project needs.

o Regular monitoring of cash flow projections.

Group 7

Reviewer for Construction Cost Engineering (CCE)

1. Introduction to Cost Accounting

 Definition:

o Focuses on analyzing and controlling production, service, and operational costs.

o Aids in decision-making, enhancing profitability and strategic planning.

 Purpose:

o Tracks costs, establishes budgets, and conducts variance analysis.

o Supports preparation of financial statements (Income Statements, Balance Sheets).

 Significance:

o Promotes operational efficiency, cost control, and financial transparency.

2. Preparing Income Statements

 What is an Income Statement?

o Also called a Profit and Loss (P&L) Statement.

o Summarizes revenue, expenses, and profits for a specific period.

o Key for assessing financial health and performance.

 Key Components:

1. Revenue: Total earnings during the reporting period.

2. Expenses: Total spending, including operating and non-operating costs.

3. Gross Profit: Revenue - Cost of Goods Sold (COGS).

4. Operating Income: Gross Profit - Operating Expenses.

5. Net Income: Total revenue - Total expenses.

6. Earnings Per Share (EPS): Net Income ÷ Total shares outstanding.

 Steps to Prepare:

1. Choose the reporting period (monthly, quarterly, or yearly).

2. Calculate total revenue and COGS.

3. Determine gross profit, operating expenses, and operating income.

4. Subtract taxes and interest to compute net income.

 Common Mistakes:

o Misclassifying expenses or revenues.

 o Failing to reconcile data regularly.

o Omitting depreciation or one-time gains.

3. Preparing Balance Sheets

 What is a Balance Sheet?

o A snapshot of a company’s financial position, showing assets, liabilities, and equity.

 Balance Sheet Equation:

o Assets = Liabilities + Shareholders' Equity

 Components:

1. Assets:

 Current Assets: Cash, accounts receivable, inventory.

 Non-Current Assets: Fixed assets (land, equipment), intangible assets (patents).

2. Liabilities:

 Current Liabilities: Obligations due within one year (accounts payable).

 Non-Current Liabilities: Long-term debts (loans, bonds payable).

3. Shareholders' Equity: Net worth (Assets - Liabilities).

 Steps to Prepare:

1. Select the reporting date.

2. Compile financial data (income statements, retained earnings).

3. List and categorize assets and liabilities.

4. Calculate and verify Shareholders’ Equity.

 Importance:

o Financial reporting, risk assessment, and capital fundraising.

o Basis for evaluating liquidity, solvency, and operational efficiency.

4. General Financial Control

 Definition:

o Policies and procedures for monitoring financial resources to ensure alignment with
business goals.
  Key Financial Controls:

1. Balance Sheet: Assesses financial position at a specific point.

2. Income Statement: Tracks income and expenses over time.

3. Cash Flow Statement: Reflects cash inflow and outflow.

 Types of Financial Controls:

1. Immediate Control: Quick response to financial discrepancies.

2. Selective Control: Focused on specific processes or areas.

3. Postdate Control: Evaluates and adjusts strategies after operations.

 Objectives:

o Enhance productivity, profitability, and resource allocation.

o Prevent fraud and ensure accurate financial reporting.

 Steps for Effective Financial Control:

1. Detect anomalies in financial data.

2. Update financial practices regularly.

3. Analyze operational scenarios.

4. Forecast future goals and outcomes.

5. Implement fraud prevention measures.

5. Conclusion and Recommendations

 Conclusion:

o Cost accounting is vital for financial transparency, operational efficiency, and strategic
planning.

o It supports businesses in achieving profitability and sustainable growth.

 Recommendations:

1. Implement robust financial tracking systems.

2. Regularly review financial statements for accuracy.

3. Train staff to improve financial management.

4. Foster continuous improvement in cost accounting methods.

Group 8

Overview

This reviewer comprehensively covers key topics on Cost Accounting, including Accounting Ratios,
Horizontal and Vertical Analysis, and Cost Audit. The focus is on practical understanding, formula
applications, and the benefits of each concept, designed to ensure clarity and retention for examination
purposes.

Key Topics for Review

1. Accounting Ratios

 Definition:
Ratios analyze financial relationships within a company’s financial statements to provide insight
into performance, efficiency, and solvency.

 Categories and Key Examples:

1. Liquidity Ratios:

 Current Ratio: Measures a company's ability to cover short-term liabilities with

short-term assets.
Formula: Current Ratio=Current Assets/Current Liabilities

 Ideal Value: ≥ 1.0 (preferably 1.3 or higher for stronger liquidity).

 Quick Ratio: Evaluates immediate liquidity, excluding inventory and prepaid

expenses.
Formula:
Quick Ratio=Cash + Marketable Securities + Accounts Receivable/Current Liabiliti
es

2. Profitability Ratios:

 Assess the ability to convert revenue into profit.

3. Leverage Ratios:

 Debt-to-Equity Ratio: Indicates the extent of company growth financed through

debt.
Formula: Debt-to-Equity Ratio=Total Debt/Shareholders’ Equity

 Ideal Value: < 2.0 to maintain balanced financing.

4. Efficiency Ratios:

 Measure asset utilization efficiency for revenue generation.

Applications of Ratios:

 Evaluate financial health.

 Compare company performance within the same industry.

 Highlight inefficiencies and areas needing improvement.

2. Horizontal and Vertical Analysis

A. Horizontal Analysis

 Definition:
Evaluates financial statement changes over time by comparing historical data.

 Steps:

1. Collect Data: Gather financial reports for consistent time intervals.

2. Comparison Methods:

 Absolute Comparison: Direct dollar value differences.

 Percentage Change: Express changes relative to the base year.

3. Identify Trends: Analyze patterns like revenue growth or cost escalation.

 Application: Tracks financial progress and identifies significant changes in performance.

B. Vertical Analysis

 Definition:
Analyzes financial statements by expressing each line item as a percentage of a base figure (e.g.,
total assets or gross sales).

 Example:
If a company reports:

o Gross Sales = $5M (100%).

o Cost of Goods Sold = $1M (20%).

The COGS contributes 20% of sales.

 Application: Assesses cost proportions and efficiency within a single period.

Comparison of Horizontal and Vertical Analysis:

Feature Horizontal Analysis Vertical Analysis

Focus Trends over time Component relationships in a single period

Feature Horizontal Analysis Vertical Analysis

Also Known As Trend Analysis Common-Size Analysis

Use Compare changes across periods Identify proportional contributions within one period

3. Cost Audit

 Definition:
A systematic review of cost records to ensure accuracy, efficiency, and compliance with
regulations.

 Objectives:

o Verify cost accuracy.

o Enhance cost control and identify inefficiencies.

o Promote compliance with legal and regulatory standards.

o Support decision-making with reliable cost data.

 Advantages:

1. To Management:

 Offers accurate cost data for pricing, budgeting, and decision-making.

 Identifies waste and fraud.

2. To Shareholders:

 Ensures fair returns through accurate stock valuation.

3. To Society:

 Controls price inflation and protects consumers.

4. To Government:

 Facilitates fair pricing, supports trade disputes, and promotes industry efficiency.

 Disadvantages:

o Time-consuming and costly.

o Limited to cost aspects without a comprehensive financial scope.

o Relies on historical data, ignoring future trends.

Key Takeaways
1. Accounting Ratios:

 Memorize critical formulas and their ideal benchmarks.

 Understand how ratios provide actionable insights into financial health.

2. Horizontal and Vertical Analysis:

 Differentiate between analyzing trends over time (horizontal) and assessing proportional
contributions within a period (vertical).

 Practice with examples to solidify understanding.

3. Cost Audit:

 Recognize its role in cost control, compliance, and operational efficiency.

 Be aware of its limitations while emphasizing its value for decision-making.

Exam Preparation Tips:

1. Practice Calculations: Apply formulas to example problems.

2. Understand Concepts: Go beyond memorization by understanding applications in real-world

scenarios.

3. Focus on Connections: Relate accounting ratios, analysis methods, and audits to one another for
a cohesive understanding.

4. Use Visual Aids: Charts or tables can simplify comparisons between horizontal and vertical
analysis.

Conclusion

By mastering these foundational principles, you will be equipped to assess financial health, optimize
resource usage, and make informed decisions. This reviewer serves as a concise yet comprehensive
guide to excel in your exam and practical applications of cost accounting.
Test Questionnaire for "CE 416 – Construction Cost Engineering"

Identification (10 points)

Instruction: Identify the correct term based on the description. Write your answers on the space
provided.

Answers Key:

1. Gantt Chart

2. Audit

3. Critical Path

4. Quick Ratio

5. PERT (Program Evaluation and Review Technique)

6. Income Statement

7. Concept Design Phase

8. Bridge Financing

9. Workforce Allocation

10. Pre-operating Costs

Question:

1. This schedule type uses visual representations like bar charts to track tasks over time.

2. A systematic review of cost records to ensure accuracy and compliance.

3. The longest sequence of dependent tasks that determines the project duration in the Critical
Path Method.

4. The ratio that measures a company’s ability to cover short-term liabilities with short-term assets.

5. A probabilistic scheduling method that calculates expected task durations based on optimistic,
most likely, and pessimistic estimates.

6. A document summarizing revenue, expenses, and profits for a specific period.

7. This phase of cost planning involves initial estimates based on basic project specifications.

8. Short-term loans with high interest rates used to fund construction projects.

9. The process of assigning tasks to skilled workers to ensure efficiency and safety.

10. The type of cost that includes legal services, permits, and feasibility studies incurred before
project execution.
True or False (10 points)

Instruction: Write "True" if the statement is correct and "False" if the statement is incorrect.

Answer Key with Explanations:

1. False – The Critical Path Method identifies the longest sequence of dependent tasks, not the
shortest.

2. True – Pre-operating costs include expenses like overtime labor and consulting fees.

3. True – A Work Breakdown Structure organizes tasks hierarchically for better clarity and
assignment.

4. False – Horizontal analysis compares financial data across time, not as a percentage of a base
figure.

5. False – PERT scheduling involves probabilistic estimates, not absolute certainty.

6. True – Cash flow projections help anticipate financial needs and align funding strategies.

7. True – Manpower scheduling prevents inefficiencies like excessive overtime and optimizes costs.

8. False – Gantt charts are not the same as Activity on Arrow (AOA) diagrams; they are distinct
visual tools.

9. True – Administrative costs include salaries for managers and expenses like office utilities.

10. True – The quick ratio excludes inventory when assessing a company's liquidity.

Question:

1. The Critical Path Method identifies the shortest sequence of tasks in a project.
2. Pre-operating costs include overtime labor and consulting fees.
3. A Work Breakdown Structure (WBS) organizes tasks hierarchically for clarity and responsibility
assignment.
4. Horizontal analysis evaluates financial statement changes by expressing items as a percentage
of a base figure.
5. PERT scheduling uses historical data to predict project timelines with absolute certainty.
6. Cash flow projections aid in anticipating financial needs and ensuring timely resource
availability.
7. Manpower scheduling prevents excessive overtime and optimizes labor costs.
8. Gantt charts are also known as Activity on Arrow (AOA) diagrams.
9. Administrative costs include salaries for project managers and office expenses.
10. The quick ratio excludes inventory when evaluating a company’s liquidity.

Multiple Choice (10 points)

Instruction: Choose the best answer for each question.

Answer Key:

1. b. Improving cash flow

2. b. Optimistic, most likely, and pessimistic durations

3. b. Critical Path Method

4. c. Direct costs

5. b. Ensuring financial stability

6. b. Project schedule

7. d. Long-term

8. b. The proportion of company growth financed by debt

9. b. Project managers and cost accountants

10. a. Tender stage Encircle the correct letter.

Question:

1. Which of the following is a key benefit of project scheduling for contractors? a. Assessing project
feasibility
b. Improving cash flow
c. Ensuring financial transparency
d. Analyzing financial statements
2. The three-point estimation in PERT scheduling includes which of the following? a. Early, late, and
critical durations
b. Optimistic, most likely, and pessimistic durations
c. Linear, bell-shaped, and back-loaded curves
d. Total budget, job costs to date, and projected costs

3. What does the acronym "CPM" stand for? a. Cost Projection Management
b. Critical Path Method
c. Cash Planning Mechanism
d. Construction Project Metrics

4. What type of cost includes materials, labor, and equipment expenses? a. Indirect costs
b. Administrative costs
c. Direct costs
d. Fixed costs

5. What is the primary purpose of cash flow management? a. Identifying critical tasks
b. Ensuring financial stability
c. Organizing project schedules
d. Enhancing profitability ratios
 6. Which type of schedule focuses on organizing tasks, timelines, and resources? a. Cost schedule
b. Project schedule
c. Material schedule
d. Subcontractor schedule

7. A cash flow projection typically forecasts inflows and outflows over what time horizon? a. Daily
b. Weekly
c. Monthly
d. Long-term

8. What does the "Debt-to-Equity Ratio" measure? a. A company’s efficiency in asset utilization
b. The proportion of company growth financed by debt
c. Liquidity for covering short-term liabilities
d. Profitability in converting revenue into profit

9. Which of the following are key users of equipment cost scheduling? a. Suppliers and contractors
b. Project managers and cost accountants
c. Labor unions and legal advisors
d. Shareholders and auditors

10. Which phase of cost planning includes contractor pricing after contracts are awarded? a. Tender
stage
b. Construction stage
c. Detailed design stage
d. Concept design stage

Enumeration (20 points)

Instruction: Enumerate the required items. Write your answers on the space provided.

Key Answers:

1. Five benefits of effective project scheduling:

o Ensures timely task completion

o Aligns teams and prevents resource conflicts

o Optimizes cash flow management

o Improves efficiency and reduces delays

o Provides clear communication and trust with clients

2. Five components of a balance sheet:

o Current assets

o Non-current assets
 o Current liabilities

o Non-current liabilities

o Shareholders’ equity

3. Four types of cash flow curves used in projections:

o Bell-shaped curve

o Linear curve

o Front-loaded curve

o Back-loaded curve

4. Three types of costs associated with pre-operating expenses:

o Fixed costs (e.g., legal services, facility costs)

o Variable costs (e.g., raw materials, marketing)

o Semi-variable costs (e.g., overtime labor, consulting fees)

5. Three steps in preparing cash flow projections:

o Start with the total project budget

o Identify job costs to date

o Allocate remaining budget across the project schedule

Question:

1. Five benefits of effective project scheduling.

2. Five components of a balance sheet.
3. Four types of cash flow curves used in projections.
4. Three types of costs associated with pre-operating expenses.
5. Three steps in preparing cash flow projections.