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Cost account

Construction estimated costis a target figure of the costs required to create a facility in strict accordance with the working project.

 

Therefore, in order to calculate a precise cost account ready and agreed working project is needed and which has been appraised.

 

The estimated cost of construction works is divided into three main parts:

 

  • direct costs,
  • overhead cost,
  • estimated profit,
  • VAT (value added tax)

 

Direct costsinclude the cost of materials, products, operational costs, machines and mechanisms, workers salaries. They are determined on the basis of the estimated rules and prices, volumes of constructions or types of work.

 

Overhead costsreflect the costs associated with the creation of general conditions of construction, that is include the costs of the organization, management and maintenance of the construction. They are determined most often on percentage of direct costs in accordance with the overhead regulations or on individual standards of the construction organization. It is also possible to determine them by means of overhead costs indicators system on types of construction and installation works or aggregate indicators for the main types of construction.

 

The estimated profitis the amount of funds needed to cover expenses which are not associated directly with this construction but necessary for the further operation of the construction organization. These are the costs for payment of taxes, production development and its infrastructure, material incentive and providing favorable conditions for workers living. The estimated profit is generally defined on percentage of total costs or labor costs using industry-wide standards or individual standards of a particular organization.