Once the Subs tab of your Small Cottage Estimate is complete, you can begin working on the Summary tab. Please note that Tools & Equip tab and Overhead tab have been completed for you.
The purpose of this assignment is to review the totals of the Small Cottage Estimate in each of Construction Phase tabs. Additionally, you must complete the following tasks for successful completion of the Summary Tab:
For the purposes of this assignment, use the following formulas to calculate Montly, Yearly, and Total interest costs, respectively.
A skid steer was purchased for $40,000. The construction company secured a $30,000 loan at 5% interest over a 3 year term. The total interest cost would be calculated as follows:
The yearly interest cost for the skid steer would be calculated as follows:
The monthly interest cost for the skid steer would be calculated as follows:
For the purposes of this assignment, use the following formulas to calculate Montly, Yearly, and Total depreciation costs, respectively.
A skid steer was purchased for $40,000. The scrap value of the skid steer after its service life of 6 years is $7000. The total depreciation cost would be calculated as follows:
The yearly depreciation cost for the skid steer would be calculated as follows:
The monthly depreciation cost for the skid steer would be calculated as follows:
For the purposes of this assignment, use the following formulas to calculate Montly taxes.
A skid steer has yearly tax costs of $800. The monthly tax cost would be calculated as follows:
Add the monthly interest, depreciation, and tax costs of each piece of equipment to calculate the total monthly cost.
Add the yearly interest, depreciation, and tax costs of each piece of equipment to calculate the total yearly cost.
The company accountant has given you the following numbers to enter in the Tools & Equip tab of the Estimating Workbook based on a forecast completed earlier.
In the Total Tools column (B), add the following values for each month:
Month | Amount |
January | $700 |
February | $250 |
March | $350 |
April | $300 |
May | $425 |
June | $150 |
July | $600 |
August | $300 |
September | $450 |
October | $175 |
November | $300 |
December | $400 |
The company accountant has given you the following numbers to enter in the Overhead tab of the Estimating Workbook based on a forecast completed earlier.
January | February | March | April | May | June | |
Advertising | $500 | $250 | $200 | $250 | $200 | $250 |
Office Personnel | Leave Alone | |||||
Computers | $1850 | $225 | $0 | $0 | $0 | $0 |
Dues and Subscriptions | $50 | $50 | $50 | $50 | $50 | $50 |
Electricity for Office | $150 | $150 | $150 | $150 | $150 | $150 |
Heat for Office (Gas) | $120 | $100 | $80 | $60 | $30 | $20 |
General Insurance | $1450 | $1450 | $1450 | $1450 | $1450 | $1450 |
Health Insurance | Leave Alone | |||||
Meals and Entertainment | $400 | $400 | $400 | $400 | $400 | $400 |
Office Supplies | $175 | $175 | $175 | $175 | $175 | $175 |
Officer Salaries | Leave Alone | |||||
Postage | $25 | $25 | $25 | $25 | $25 | $25 |
Professional Fees | $1590 | $100 | 0 | 0 | 0 | 0 |
Rental Expenses | $650 | $650 | $650 | $650 | $650 | $650 |
Telephone | $250 | $250 | $250 | $250 | $250 | $250 |
Tools and Equipment | Leave Alone | |||||
Travel | $200 | $200 | $200 | $200 | $200 | $200 |
Vehicles | $550 | $550 | $550 | $550 | $550 | $550 |
Base your calculation on an estimated yearly gross income of $2,000,000.
This is calculated as the sum of all yearly estimates for each overhead line item. See your Ranch House Estimate as an example.
This is calculated as the sum of the Total Net Annual Payroll Amount for each employee from the Wage tab of your estimating workbook. See your Ranch House Estimate as an example.
Calculate this figure by dividing your Estimate Yearly Gross Overhead by your Estimated Yearly Gross Income ($2,000,000).
Navigate to the Summary tab of your Small Cottage Estimating Workbook.
Please note the following points, then enter the correct numbers in the Summary tab of the Small Cottage Estimating Workbook.
The next step for completing the Summary tab of the Small Cottage Estimating Workbook requires you to select which items will include adjustments for overhead, profit, and sales tax. Use the following guidelines to do so.
Sales tax must be paid. It is the law.
Remember, sales tax must be accounted for and paid by someone. If it is not included in line items as outlined above, the client will not pay them. In this scenario the construction company will pay sales tax, which will cut into profit.
The Summary tab includes a total of each subsection of each construction phase. Within those tables are columns for Overhead, Profit, and Sales Tax.
To add adjustments to a line item for Overhead, Profit, and/or Sales Tax, add an "x" into the the provided space in the column for each respective adjustment. The calculation will be completed and added to the total cost for the line item.
In the following example, notice that the columns for Overhead, Profit, and Sales Tax that include an "x" include a calculation based on the respective percentages in the Summary tab heading, and that a total is for each line item is calculated.
This content is provided to you freely by BYU-I Books.
Access it online or download it at https://books.byui.edu/construction_estimat/small_cottage_summar.