Budget Estimating

This assignment consists of 2 parts: questions about budget estimation and developing a budget.
Part 1 Questions
Provide responses to the following questions
1. You are providing a review of contractor bids for a component of your upcoming project. What can be done to determine whether or not a vendor’s bid is reasonable?
2. Describe the conditions for which parametric, analogous and bottom up estimation techniques work best, and provide 2 examples in support of each method.
3. Why is a cost management plan important? How does the plan benefit the project manager?

Part 2 Budget Estimating
Using the same scenario from the previous unit on scheduling, create a time-phased budget for the following project. Prepare a figure like Exhibit 10.9, CPT 4e, that illustrates the daily and cumulative costs for
the resource-leveled project.
Assume the following hourly rates:
Alcides $45 / hr.
Joan $50 / hr.

Activity ID Activity Immediate Predecessor Duration in days Resource Work Hours per Day
A Evaluate freezers 2 Alcides 6
B Chart temperatures 6 Joan 4
C Review service record 2 Alcides
D Consult with HVAC engineer A, B, C 3 Alcides
E Develop construction plan D 10 Joan
F Complete IC assignment E 2 Alcides
G Complete ROI analysis E 5 Joan
H Conduct regulatory review E 4 Joan
I Obtain construction approval F, G, H 2 Alcides

Part 3 Budget Estimating

You are the project manager for a process improvement project for Company XYZ. Prepare a figure like Exhibit 10.9 that illustrates the weekly and cumulative costs for the resource-leveled project.
Hint: To accomplish this exercise, you’ll need to create a project schedule in MS Excel (or by hand), create resource assignments, assign costs to each resource, and assign the resources to each task. Some
resource leveling will be required.























Sample Solution