Approximate Method of Costing

            General principle of approximate method of costing:

          There are various methods by which approximate estimates of an interior can be prepared. But in the general principle, they all consist of multiplying the number of items and units in the proposed structure by the known cost of a similar item or unit in a similar existing interior.

Thus it is a simple process involving two operations:

·         Fix up the unit and count the number of such units in the proposed work

·         Fix up the unit cost by studying the actual cost of similar existing structure constructed in near past.

             If it becomes necessary to change the actual unit cost due to variations in construction costs, the same can be carried out plinth the help of a simple device known as cost index. It I a device which shows the relative changes in the cost of specific or group of items over a certain period of time. Following is the procedure of preparing the cost index:

·         The base period is selected

·         The critical items comprising the index are decided

·         Weight is assigned to each item

·         Periodic unit prices are collected

·         Index worked out by the equation

 Approximate method of costing for various interior works:

The approximate cost of an interior work can be found out by the use of any one of the

following five methods.

                ·         Service – unit method

                ·         Square – meter method

                ·         Cubic – meter method

                ·         Typical – bay method

                ·         Approximate Quantities method

The methods are arranged in degree of accuracy, i.e. the first method tkestheleast time and the

results are very approximate while the last method takes more time than any other method but

the result are more accurate. We will now discuss all these methods in detail.

1.     Service – unit method:

      The service unit method indicates the most important unit in an interior wok for e.g. in the

interior work of a school building, the service unit is a class room; in a hospital, it is a bed; in a

large apartment, it is tenement;  in a cinema, it is seat; in a prison, it is cell; in a stable, it is

animal; in a hotel, it is room; in an office building it is room; in a stadium, it is seat, Then,

      Approximate cost of an interior work= Number of service units in the interior work x cost of

corresponding service unit in a similar existing interior work.

      For instance, suppose an interior work of a school building of 16 classrooms is to be

renovated and further let us assume that the cost of renovation of a classroom in a similar

existing school building is Rs. 20,000. Then approximate cost of the proposed interior work of a

school building would be 16 X RS. 20,000 or Rs. 3,20,000.

               Following points are to be noted:

·         The prepared by this method vary considerably according t the types of construction and standard of finish

·         The estimates prepared by this method are very approximate in nature.

·         The proposed interior work should resemble the existing structure practically in all respects, so as to bring its approximate cost nearer to its true cost.

·         Change of price level of different items of interior work should also be taken into account while finding out the approximate cost of a proposed interior work.

·         By service unit method, the approximate cost of a structure can be easily worked out and it takes less amount of time any other method.

              2.   Square – meter method:

               In this method, the area of each floor in the proposed building is worked out in square                   meter. Then, approximate cost of the proposed building interior = total area of all the floors X             cost per square meter of a similar existing interior work.

               For computing floor area, measurements are taken out to out of walls and generally no                 deductions are make for stairways or similar other gaps. For working out plinth area, the                     projections at plinth level are excluded.

        Following factors affect the approximate cost worked out by this method:

·         Change of price level: naturally, if the price level has changed considerably, cost per square meter of the existing interior should be suitably modified so as to accommodate this change of price level.

·         Ceiling height: in this method, height of the floor is not taken into account. hence, if the height of the proposed interior work is to be more or less than the existing one, the cost per square meter should be slightly raised or lowered accordingly.

·         Type of construction: the type of construction and the standard of finish of the proposed interior work should be nearly the same as that of the existing one. This will bring the approximate cost of the building very near to the actual final cost.

·         Shape of the interior work: it is clear that interiors in square buildings will cost less per square meter than the rectangular ones of the same area. This is due to the fact that the square buildings have fewer perimeters of walls than that of the rectangular buildings of the same area. For instance, suppose there are two building interior – a square one of size 10m X 10m and a rectangular one of size 20m X 5m. The areas of the two building interiors are the same, namely 100 sq. m. But the perimeter of walls in case of square building interior will be 40 meters while it will be 50 meters in case of rectangular building interior. Thus cost of rectangular building interior will generally be more than the cost of square building interior.

·         Large openings: if there are large openings in the floors, suitable adjustments should be made in the cost per square meter.

·         Location of the building interior: the similar existing interior, whose cost per square meter is to be taken to arrive at the approximate cost of the proposed building interior, should be similarly situated to the proposed building, as it will be absurd to compared two buildings situated far away from each other.

                             3.     Cubic – meter method:

               In this method, cost per cubic meter is used as a base for finding out the approximate cost of           the proposed building interior. Cubical contents of the proposed building interior are worked               out and then:

              Approximate cost of proposed building interior = total cubical contents of proposed building          interior X cost per cubic meter of a similar existing interior.

              Measurements of the area are taken as in case of previous method and then this area is                    multiplied by the height of the floor so as to get the cubical contents of the proposed building              interior. All the factors mentioned in the previous method affect the approximate cost worked              out by this method. Following few more points require further attention:

·         There is no general agreement regarding the inclusion of cubical contents of open verandas, open porches, plazas, etc. in the total cubical contents of the proposed building interior, some estimators include them while others do not.

·         There is no general rule for measuring the height of the proposed building interior.

·         Great care should be taken in fixing the cost per cubic meter for the proposed building interiors of a similar nature.

·                                     To obtain satisfactory results with the help of this method, it is absolutely necessary to                    employ the same person to fix the cost per cubic meter and also to calculate the cubical contents          of the proposed building interior. If the cost per cubic meter is decided by one person and                    cubical contents are calculated by another person, the results obtained are quite likely to be                  wrong and misleading.

                 4.  Typical- bay method:

              This method is useful in case of interiors which have several similar bays. A bay is a space             from center to center of two successive columns. A typical interior bay is selected and its total             cost is worked out. Then,

               Approximate cost of proposed interior= number of bays in the proposed interior X cost of               one bay.

                Following points are to be noted:

·         Necessary correction should be made for the end bays due to end walls and also in other bays, if there is any difference in farming.

·         This method is useful for factories and such similar interiors.

·         More time is required by this method than any other previous method. But the result obtained by method are found to be more reliable.

                 5. Approximate quantities method:

                   In this method, various quantities are worked out with the help of many short- cuts. For               instance wall paneling are measured in linear measurements, i.e., in running meter the                         approximate quantities of items such as partitions, paneling, water proof treatment are                        computed per running length and with the help of rates of these items, a fairly accurate price per          running meter is built up. This price when multiplied by the total running measurements give              the approximate cost of the building interiors required.

               Following points are to be noted:

·         The grouping of items and fixing their approximate price depend mainly on the experience of the estimator.

·         In this method, sufficient allowance should be made to compensate for the small things that are over – looked.

·         Out of all the previous methods, this method gives an estimate which is very near to the final estimate. It requires more time. But the results are quite satisfactory.

Problem 1:

A person purchases a building and renovates the portion of plinth area of 100 sq. m. in this building. The renovation cost is Rs. 28,000/-. The height of the building upto top of the floor is 3.40m. a parapet wall of height equal to 80 cm. is constructed on the terrace. Work out the cost the cost per square meter and cubic meter of interior.

If a similar interior of plinth area equal to 140 sq. m. is to be renovated in nearby locality, what would be its approximate cost of construction?

Solution:

Cost per sq. m. = 2800/100=280rs.

 For finding out the cost per cu. M., a suitable height is to worked out. There is no general rule for fixing this height. In this case, the height of the building is measured between 20 cm below plinth level to center of parapet wall.

Height of the building = 0.20 + 3.40 + 0.5 x 0.8. = 4.00 m

Cubical content =100 x 4.00 = 400 cu. M.

Therefore, cost per cu. m. = 28000/400 = 70/- Rs.

Plinth area of the similar interior = 140 sq. m.

Therefore, cost of renovation = 140 x 280 = 39200/- Rs.

Cubical content of the similar interior = 140 x 4 = 560 cu. M.

Therefore, cost of renovation = 560 x 70 = 39200/- Rs.

Problem 2:

If the foundation cost up to plinth level is Rs. 8000/- work out the approximate cost of first floor renovation of the interior with built up area as 65 sq. m.

Solution:

Foundation cost per sq. m. = 8000/100 = 80/- Rs.

Cost per sq. m. of first floor = (280 – 80) = 200/- Rs.

Therefore, approximate cost of the first floor renovation = 200 x 65 = 13,000/- Rs.

ESTIMATION IN INTERIOR DESIGNING

Defination: Estimation is a tool for planning and controlling the construction activity of any project with respect to quality, time and finance.

Estimation: There are two things involved in construction quality and quantity, these two things lead to govern the estimate of the work. By calculating quantity required and quality of that material you can find estimation.

Quantity can be find through the study and analyses of drawing which is prepared with respect to the design of the project.Thus the quantity decides the quantum of work involved in the construction and it help in finding out the quantities of various material required as well as the total labour necessary for the work.

Quality is governed through specifications for material and workmanship.

Estimation is a forecast of probable cost of any project. Before undertaking any work or project it is necessary to know the probable cost of the project which was found by the estimation. The primary object of an estimation is to enable to know the cost of work before the work start. The actual cost is known only after the work completed.

If estimate is prepared carefully and correctly by the person (estimator) who is experienced and fully know the method of work, then there will not be much difference between estimated cost and actual cost of the project.

The estimation is prepared by calculating the quantities required and then calculating the cost at suitable rates , to get the approximate cost of the projet. Provision of contingencies, 3% to 5% of the estimated cost, is made in the estimate to cover the miscellaneous expenditures which do not come under any item of work. Also added the work charged establishment at 1.55 to 2% of the estimated cost. The cost of the preliminary works and surveying, cost of land including cost of acquisition, cost of leveling and dressing of ground and the cost of other external services are required to be provided in the estimation besides the estimated cost of the different items of the main work. Provision for supervision of departmental charges 5 to 10% of the estimated cost is also made to get the estimated cost of the whole project.

The process of preparing an estimate is known an estimating and it includes two steps

• Taking out quantities
• Abstracting

Taking Out Quantities: The details of measurements of each item of work are taken out correctly form plan and drawings and quantities under each item are calculated in a tabular form named as details of measurement form as follows:

Item No.	Description or Particulars	No.	Length	Breadth	Height or Depth	Content or Quantity

Abstract Of Estimated Cost: The cost of each item of work is calculated in a tabular form from the quantities already computed and total cost is worked out in abstract of estimate form as shows below

Item No.	Description or Particulars	Quantity	Unit	Rate	Amount

Types Of Estimation:

1. Preliminary Estimate
2. Plinth Area Estimate
3. Cube Rate Estimate
4. Approximate Quantity Method Estimate
5. Detailed Estimate
6. Revised Estimate
7. Supplementary Estimate
8. Annual Repair or Maintenance Estimate

1. Preliminary Estimate:

It is also called as Approximate estimate or Abstract estimate or Rough cost estimate. It is required for studies of various aspects of a work to decide the financial position before the work starts. In such project which gives revenue income, income will be calculated and preliminary estimate is formed, by comparing this calculation it may be seen whether the investment on the work is justified or not.

2. Plinth Area Estimation:

This is a approximate estimation. This is prepared on the basis of plinth area of building, the rate being deduced from the cost of renovation of similar building having similar specification. Plinth area estimate is calculated by finding the plinth area of the building and multiplying by the plinth area rate. The plinth area should be calculated for the covered area by taking external dimensions of the building at the floor level. Courtyard and open spaces should not be included in this.

3. Cube Rate Estimation:

Cube rate estimation is a approximate estimation. It is prepared on the basis of cubical content of the building. This is calculated by finding the cubical contents length x breath x height and multiplied by cube rate. It is similar as plinth area but more accurate than plinth area estimate as height is also calculated.

4. Approximmate Quantity Method estimation:

In this method approximate total length of walls is calculated in running metre and its total length is multiplied with rate per running metre of wall. The running metre cost for structure and the interior should be calculated first and these running metre rates should be multiplied by the total length of the walls.

5. Detailed Estimation:

Detail estimate consists of working the quantities of each item of work and there working cost. Length, breadth, and height are taken out correctly and quantities of each item are taken out correctly from drawing and quantities of each item are calculated and biling are done.

Item No.	Description	No.	Length	Breadth	height	Quantity

By this chart Quantity of each item find detail of each item properly is necessary.

Item No.	Description	Quantity	Unit	Rate	Amount

After finding proper quantities there units put the value in this chart by applying proper rate of particular item you can find the amount. by adding your fees charges and other charges according to requirement of work the final estimation will be find.

6. Revised Estimate:

It is accurate estimate and is prepared when the original sanctioned estimate is exceeded by more than 5 %. Or expenditure on the work exceeds the amount of administrative sanction by more than 10%. Or material deviation from original proposal attached by statement showing the variation of each item.

7. Supplimentry Estimate:

It is a accurate estimate and is prepared when additional work are required. This is fresh detailed estimate of the additional work that can be during progress of work or further work after completing your previous work.

8. Annual Repair or Maintanance Estimate:

It is accurate estimate and is prepared to maintain the structure in proper order and safe condition. It include white washing, color washing, painting, minor repair etc.

9.  Supplementary and revised estimate: 

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 sanctioned estimate, or when there are material deviations and changes in the design which may cause substantial saving in the estimate, then 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.

If at any time either before or during the execution of original work, it is found that the original estimate is excessive, and then divisional officer may sanction a revised other higher authorities are informed.