Estimation and Costing

Estimation and Costing
@S_Kirar

Some important definitions
Estimate:
 An estimate is the anticipated or probable cost of a work and is usually prepared before
the construction is taken up. The estimate is prepared by computing or calculating the
quantities required and then calculating the cost at suitable rates, to get the expenditure
likely to be included in the construction of the work or structure.
Actual Cost:
 The actual cost of a work is known at the completion of the work. Account of all
expenditure is maintained day to day during the execution of work in the account section
and at the end of the completion of the work when the account is completed the actual
cost is known.
Competent Authority:
 An officer or any other authority in the department to whom relevant powers are delegated
by the government (Financial Department).

 Administrative Approval or Sanction: it denotes the formal acceptance by the department
concern of the proposal and after the administrative approval is given the engineering
department (PWD) take up the work and prepare detailed designs plans and estimates and
then executes the work. The engineering department prepares approximate estimate and
preliminary plans and submits to the department consent for administrative approval.
 Technical Sanction: it means a sanction of the detailed estimate, design calculations,
quantities of works, rates and cost of the work by the competent authority of the
engineering department. After the technical sanction of the estimate is given then only the
work is taken up for construction. The power for technical sanction differs from state to
state.
 Bill of Quantities: it is a statement of the various items of work giving the description,
quantities and unit of rates. It is prepared in a tabular form similar to the Abstract of
estimated cost of the detailed estimat, but the rate and amount columns are left blank. It is
primarily meant for inviting tender and supplied to the contractor to fill up the rates and
amounts columns.

SITE PLAN:
 It is the plan drawn for a particular construction showing its position with respect to
approaching roads, main bazars, markets and other permanent features in a populated area. It
shows the location of the area under construction with respect to the other areas and on it
generally the names of the owners of areas or property holders adjoining to it are also denoted.
North line is also clearly marked on it.
LINE PLAN:
 Line plan can be defined as the plan of a particular construction simply showing main features
with the help of the single lines of different portions of the constructions. Details of
constructions are not generally shown on this plan. This inside and outside dimensions shown
on this plan should necessarily be corresponding to actual dimensions.
INDEX PLAN:
 This is the plan of a particular colony showing the positions of different houses in single lines
their number if any position of roads, schools, market, hospitals and other features etc. this
plan is generally fixed on the entrance, or at exit or in the central place of the colony, for the
guidance of the inhabitants and outsiders.

Contingencies:
 It indicates incidental expenses of miscellaneous character which cannot be classified
under any distinct item sub-head, yet to pertain to the work as a whole.
 In an estimate a certain amount in the form of contingencies of 3 to 5 percent of
estimated cost, is provided to allow for the expenses for miscellaneous petty items
which do not fall under any sub-head of item of work.
Work-charged Establishment:
 It is establishment which is charged directly. During the construction of a building or a
project, a certain number of work-supervisors, choukidars, munshies, etc. are required
to be employed, and their salaries are paid from the amount of work-charged
establishment provided in the estimate.
 For work-charged establishment a percentage of 1.5 to 2 percent of the estimated cost
is included in the estimate.
Tools & Plants (T&P):
 For big work or project a percentage of 1 to 1.5 percent of estimated cost is provided in
the estimate for the purchase of tools and plants which will required for the execution of
the work.

Electrification, Sanitary and Water Supply Works:
 In building work for internal electrification, sanitary and water supply works a
percentage of about 20% of the estimated cost of building I’d provided.
(I) Sanitary and Water Supply Works 8% of the estimated cost of building works.
(II) Electrification 8% of the estimated cost of building works.
(III) Electric fans 4% of the estimated cost of building works.

Different types of estimates
1. Preliminary Estimate (Approximate or Abstract or Rough Cost Estimate
2. Plinth Area Estimate
3. Cubical Content Estimate or Cube Rate Estimate
4. Approximate Quantity Method Estimate
5. Detailed Estimate or Item Rate Estimate
6. Revised Estimate
7. Supplememtary Estimate
8. Suplementary and Revised Estimate
9. Annual Repair Or Maintenance Estimate (A.R or A.M. Estimate)

1. Preliminary or Approximate or
Abstract or Rough Cost Estimate
 This estimate is generally prepared in initial stages to know the approximate cost of the project. By this estimate, the
competent sanctioning authority can decide the financial position and policy for the administration section.
 Preliminary estimates are prepared with reference to the cost of similar type projects in a practical manner.
 The items of work include the cost of lands, cost of roads, electrification, water supply costs, cost of each building,
etc.
The preliminary estimate may be prepared by various ways for different structures and works:-
(I) Buildings: Per unit basis, plinth area basis, cubic content basis, approximate quantity method
(II) Roads and Highways: Per kilometre basis depending on the nature of road, width and thickness of metalling etc.
(III) Irrigation channels: Per kilometre basis, area of land commanded.
(IV) Bridges and Culverts: Per running meter of span depending on the roadway, nature and depth of foundation and
nature of structure etc.
(V) Sewarage and Water supply projects: on the basis of per head of population served, on the basis of area covered (per
hectar basis)

2. Plinth Area Estimate
 Plinth area cost estimate is prepared on the basis of plinth area of building.
(Plinth area- the area covered by external dimensions of building at the floor level)
 Plinth area rate of building which is the cost of similar building with specifications in that
locality.
 Plinth area estimate is obtained by multiplying plinth area of building with plinth area rate.
For example if we require plinth area estimate of 100 sq.m in a particular locality and
plinth area rate of a building in same locality is 2000 per sq.m then plinth area estimate is
100 X 2000 = 200000.
 Open areas, courtyards, etc. are not included in the plinth area. If the building is multi-
storied, the plinth area estimate is prepared separately for each floor level.

3. Cube Rate Estimate
 Cube rate cost estimate of a building is obtained by multiplying plinth area with the
height of building. (Height of building should be considered from floor level to the
top of the roof level)
 It is more suitable for multi storied buildings.
 This method of estimation is accurate than plinth area method.
 The rate per cubic meter is taken into consideration based on the costs of similar
type of buildings situated in that location.
 Foundation, plinth and parapet above the roof level are not considered in this type
of estimate.

4. Approximate Quantity Method Cost
Estimate
 In this method, the total wall length of the structure is measured and this length is
multiplied by the rate per running meter which gives the cost of the building.
 The rate per running meter is calculated separately for the foundation and superstructure.
 In case of foundation, rate per running meter is decided by considering quantities such as
excavation cost, brick work cost up to plinth. While in case of superstructure quantities like
brickwork for wall, wood works, floor finishing etc. are considered for deciding rate per
running meter.

5. Detailed Cost Estimate
 Detailed cost estimate is prepared when competent administrative authority approved the
preliminary estimates. This is very accurate type of estimate. Quantities of items of work
are measured and the cost of each item of work is calculated separately.
 The rates of different items are provided according to the current workable rates and total
estimated cost is calculated. 3 to 5 % of estimated cost is added to this for contingencies as
miscellaneous expenditure.
The detailed Estimated should consist following details and documents.
(a) Report
(b) General Specifications
(c) Detailed Specifications
(d) Drawings/plans – layout plans, elevation, sectional views, detailed drawings etc.
(e) Designs and calculations – In case of buildings design of foundations, beams, slab etc.
(f) Schedule of rates

1. Drawings- Plans, sectional elevation and detailed drawings to scale, fully dimensioned are
required. The plan, elevation and sectional elevations are usually drawn to a scale of 1 cm = 1 m,
and detailed drawings are prepared to scale of 1 cm = 10 cm to 1 cm = 29 cm.
2. Specifications- (i) General specifications gives the idea of nature, quality & class of work and
materials etc. to be used in the various parts of the work. (ii) Detailed specifications gives the
detailed description of the various items of work laying down the quantities and qualities of
materials, their proportions, method of preparation, workmanship and execution of work.
3. Rates: The rates per unit of various items of work, the rates of various materials to be used in
the construction, and the wages of different categories of labour, skilled or unskilled as mason,
carpenter, mazdoor, bhishti, etc. available for preparing estimate. The location of work and its
distance from the source of materials and the cost of transport should be known. These rates may
be obtained from PWD schedule of rate book or the rates may be worked out by the analysis of
rate method
Detailed Cost Estimate

6. Revised Cost Estimate
 Revised estimate is a detailed estimate and is required to be prepared under any one of the
following circumstances:-
(i) When the original sanctioned estimate is exceeded or likely to exceed by more than 5%
(ii) When the expenditure on a work exceeds or likely to exceed the amount of administrative
sanction by more than 10%
(iii) When there are material deviation from the original proposa, even though the cost may be
met from the sanctioned amount
 The reason behind the revision of estimate should be mentioned on the last page of revised
estimate.

7. Supplementary Cost Estimate
8. Supplementary and Revised Estimate
 Supplementary cost estimate is a detailed estimate and it is prepared freshly when
there is a requirement of additional works during the progress of original work.
 The estimate sheet should consists of cost of original estimate as well as the total
cost of work including supplementary cost of work for which sanction is required.
 When a work is partially abandoned and the estimated cost of the remaining work is
less than 95% of the original work, that is less than 95% of the original sanction
estimate or when there are material deviations and changes in the design which may
cause substantial savings in the estimate that the amount of the original estimate is
revised by the competent authority.
 A supplementary and revised estimate is then prepared and fresh technical sanction of
the competent authority is obtained

9. Annual Repair Cost Estimate
 The annual repair cost estimate is also called as annual maintenance estimate which is
prepared to know the maintenance costs of the building which will keep the structure in
safe condition. Whitewashing, painting, minor repairs, etc. are taken into consideration
while preparing annual repair estimate for a building.

Estimation and Costing

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