Which items are indirect (soft) costs in a construction budget?
Correct Answer
B) Architect fees, construction financing and permits
Why this is correct: Indirect (soft) costs are expenses not directly tied to physical construction but necessary to complete the project. They include design fees, permits, financing costs, insurance, and legal fees. Both hard (direct) and soft costs are included in the estimate of cost new. Why the other choices are wrong: "Framing lumber and the crew's wages" are direct (hard) costs for materials and labor. "The poured concrete foundation and its steel rebar" are direct (hard) costs for materials. "Roof shingles, flashing and gutters" are direct (hard) costs for materials. Exam tip: Soft costs = everything but the physical building (design, fees, financing). Hard costs = bricks and mortar.
Why This Is the Correct Answer
Why this is correct: Indirect (soft) costs are expenses not directly tied to physical construction but necessary to complete the project. They include design fees, permits, financing costs, insurance, and legal fees. Both hard (direct) and soft costs are included in the estimate of cost new. Why the other choices are wrong: "Framing lumber and the crew's wages" are direct (hard) costs for materials and labor. "The poured concrete foundation and its steel rebar" are direct (hard) costs for materials. "Roof shingles, flashing and gutters" are direct (hard) costs for materials. Exam tip: Soft costs = everything but the physical building (design, fees, financing). Hard costs = bricks and mortar.
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