Term
| Why is it important to establish a budget early on ? |
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Definition
| It influenes many design decisions & can help determine whether a project is even feasible |
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Term
| What should the designer keep the client advised of (budget wise)? |
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Definition
| any changes that might influence final cost |
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Term
| How are budgets usually set? |
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Definition
| Client already has estimated amount of money available or client describes extent of work & asks designer to develop the budget |
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Term
| What types of clients generally have a good idea of what new/remodeled facilities usually cost? |
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Definition
Corporate clients.
Residential clients generally have a poor idea |
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Term
| What happens if there's not enough money set aside for the job after a budget has been developed by the designer? |
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Definition
| The budget may need to be increased or the scope of work may need to be decreased |
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Term
| What is there always a relationship among for budgets? |
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Definition
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Term
| Why must a client budget for more than construction costs & furnishing expenses? |
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Definition
| Many other factors affect the final project cost |
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Term
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Definition
| $ required to build/remodel interiors |
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Term
| What do construction costs include? |
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Definition
| Anything attached to & becomes part of a structure. Also: demolition, partitions, ceilings, millwork, finishes, plumbing, electrical, mechanical work |
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Term
| Why are FF&E separate budget items on most projects? |
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Definition
| Because of the way they are purchased, specified, and installed is different than the way construction items are handled |
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Term
| How are furniture purchases handled through an interior designer? |
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Definition
| purchased directly through designer or specified by designer |
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Term
| Furniture deserves a separate budget because: |
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Definition
| the various discounts designer or client receives & the tax that must be paid |
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Term
| What is an example of when there is a choice between placing an item in FF&E vs. construction budget? |
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Definition
| A fridge was specified by an interior designer but purchased & installed by the general contractor - or was purchased directly by the client/designer for installation after construction was completed |
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Term
| What does an FF&E budget usually include: |
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Definition
| furniture, appliances, free standing equipment, window coverings, rugs, interior plants, lamps, artwork, accessories |
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Term
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Definition
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Term
| What 2 classifications is overhead divided into? |
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Definition
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Term
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Definition
Cost of running contracting business:
office rent, secretarial help, utilites, other recurring costs |
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Term
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Definition
| $ it takes to complete job (not including labor, materials, equipment): temp offices, project telephones, trash removal, insurance, permits, temporary utility hookups |
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Term
| What do total overhead costs usually range from? |
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Definition
| 10-20% of total costs for labor, material, equipment |
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Term
| What is one of he most higly variable parts of a budget? |
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Definition
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Term
| What does profit depend on? |
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Definition
type of project-size-amount of risk involved-how much contractor wants to make
Market conditions- job is being bid or negotiated |
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Term
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Definition
Is % of total labor, equipment, & overhead to a job
Usually 5-15% of total cost of job |
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Term
| What percentage is the total of overhead & profit of construction cost? |
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Definition
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Term
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Definition
Charges for interior designer's services & fees for architects, mechanical engineers, electric engineers
Also costs for special consultants, legal fees, & testing |
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Term
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Definition
| sales tax on furniture, accessories, & other purchased items |
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Term
| How must tax be factored into budgets? |
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Definition
| If client has total budget for purchased items, tax must be deducted from top so the designer knows how much $ is actually available for buying the items |
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Term
| Who collects tax on material used in construction? |
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Definition
Contractors/subcontractors
Should be part of the construction budget |
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Term
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Definition
| $ required to physically relocate or costs to reprint stationery |
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Term
| Telephone & data system install: |
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Definition
phone & data systems (computers, local networks)purchased separately & installed by specialty companies.
Costs for these systems should be kept separate |
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Term
| Why is the telephone & data system install relevant to the interior designer? |
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Definition
| Designer may need to coordinate their work with suppliers of these services to provide space for equipment, proper locations of outlets, conduits, & other required mechanical & electrical support services |
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Term
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Definition
| Added to budget to account for unforseen change requests by the client & other conditions that will add total cost to job |
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Term
| Why will an early project budget show higer % of contingencies? |
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Definition
There are more unknowns @ beginning of project
From 5-10% of total budget should be included |
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Term
| Why is budgeting an ongoing activity? |
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Definition
| It is revised @ each phase of the project as more decisions are made |
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Term
| When is the final budget created? |
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Definition
After the construction documents have been completed & furniture specification have been finalized
-A detailed estimate is calculated |
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Term
| What is the most preliminary type of cost estimate based on? |
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Definition
| Square footage/size before design work has started |
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Term
| How can cost be based on square footage? |
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Definition
| The anticipated square footage is multiplied by cost per sq ft |
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Term
| What are 3 other methods of determining costs before a project begins? |
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Definition
| Based on experience with similar projects, knowledgeable contractors, or cost books |
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Term
| How can other costs be initially generated? |
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Definition
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Term
| What are types of additional costs to expect? |
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Definition
| contractor's overhead & profit, taxes, etc. |
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Term
| What is an example of a unit other than square footage that can be used to estimate costs for some facilities? |
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Definition
| Rules of thumb for costs per hotel room |
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Term
| Best to develop 3 budgets: |
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Definition
low, medium, & high cost per sq. footage or unit
Gives probably range of $ required |
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Term
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Definition
| Involves an expanded itemization of construction quantities & furnishings & assignment of unit costs to these quantities |
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Term
| How are ares multiplied to develop total budget? |
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Definition
| multiplied by the estimated cost per sq. footage |
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Term
| What happens if a design has not progressed to specification selections? |
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Definition
| The average cost can be established & assigned to the total area of project |
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Term
| What is the benefit of the parameter method? |
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Definition
| It becomes possible to evaluate the cost implication of each building component & make decisions about quantity & quality that meet the original budget established |
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Term
| What are line items based on in the parameter method? |
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Definition
| Commonly used units that relate to constructin elements or cost item under study |
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Term
| Detailed Quantity Takeoffs: |
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Definition
| Most precise kind of budget developed by counting actual quantities of material, furnishings, & multiplying by firm, quoted cost |
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Term
| What should be developed to create an accurate Qty takeoff sheet for furniture? |
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Definition
| list of all individual pieces, exact manufactureers & model #s, color & fabric selections, applicable discounts, delivery costs, required taxes |
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Term
| What are 2 ways that detailed quantity take offs are made for projects involving construction? |
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Definition
Negotiated jobs: contractor takes construction documents & specs & makes precise estimate including overhead & profit
Client can hire independent cost estimator to develop a reasonably accurate budget |
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Term
| What happens if the final budget price is too high? |
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Definition
| the professionals and clients must work together to adjust costs |
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Term
| What is the difficult aspect of developing project budgets? |
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Definition
| Obtaining current, reliable prices for the kinds of furnishings & construction units you are using |
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Term
| What can happen from the early phases of a project until the time when P.Os are written? |
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Definition
| Costs & taxes can increase or client may change their mind requesting more/less expensive item |
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Term
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Definition
Commercially produced & published annually
Some are detailed giving cost for labor, materials, & independent construction components
Others list parameter costs & subsystem costs |
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Term
| What is the best source for obtaining cost information? |
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Definition
| local contractors or design pros who have experience in type of project you're budgeting |
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Term
| What are 2 additional costs that a client may want to include in the budget? |
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Definition
| Financing and an inflation factor |
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Term
| What is generally not included in the project budget because it is an ongoing cost to the owner, as are maintenance costs? |
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Definition
| Long-term interest/debt service |
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Term
| How is a budget best developed to account for inflation? |
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Definition
| the present budget estimate should be escalated to a time in the future at the expected midpoint of construction |
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Term
| What is another way to compare & evealuate alternative construction components? |
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Definition
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Term
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Definition
| Technique in which a matrix is drawn w/ the various alternatives along one side & the indivdual elements that combine to make up the total cost of the alternatives along the other side |
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Term
| What are some factors that could be compared in a matrix costing? |
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Definition
| Cost of custom built versus pre manufactured workstations, task lighting that could be planned w/ custom-built units versus higher wattage ambient lighting |
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