In Florida construction projects, when should allowances typically be used in cost estimates?
Correct Answer
B) For items where exact specifications are not yet determined but approximate costs are known
Allowances are used for items where the exact specifications haven't been determined but the approximate cost range is known, such as plumbing fixtures or finish materials. They allow the project to proceed while final selections are made.
Why This Is the Correct Answer
Allowances are a standard estimating practice used when the project design is not fully complete but construction needs to proceed. They provide a placeholder dollar amount for items like plumbing fixtures, light fixtures, or flooring where the exact brand, model, or specifications haven't been selected yet. This allows contractors to provide complete bids while giving owners time to make final material selections. Allowances are typically based on industry standards and the contractor's experience with similar projects.
Why the Other Options Are Wrong
Option A: Only for change orders after contract execution
Allowances are established during the initial estimating and bidding phase, not after contract execution. Change orders are used to modify existing contract terms, while allowances are predetermined amounts included in the original contract for unspecified items.
Option C: As a substitute for detailed quantity takeoffs
Allowances supplement detailed quantity takeoffs rather than replace them. Quantity takeoffs are still required for all items with known specifications and quantities. Allowances only cover specific items where exact specifications are unknown, not the entire project scope.
Option D: Only for owner-purchased materials
Allowances can be used for both contractor-purchased and owner-purchased materials. The key factor is whether specifications are determined, not who purchases the materials. Many allowance items are actually purchased by the contractor and installed as part of their scope of work.
Memory Technique
Think 'ALLOW-ance' = ALLOW the project to proceed when specs aren't final yet. Allowances give you permission to move forward with approximate costs.
Reference Hint
Look up 'Cost Estimating' or 'Bidding Procedures' chapters in construction management references, particularly sections on allowances and contingencies.
More Contract Admin Questions
A project experiences a 30-day delay due to unusually severe weather. The contract includes a liquidated damages clause of $1,000 per day for delays. If the weather delay is excusable but not compensable, what liquidated damages apply?
A commercial project requires a total of 12 inspections. The building department charges $85 per inspection for the first 5 inspections, $65 for inspections 6-10, and $45 for any additional inspections. What is the total inspection fee?
What document must be posted at the job site before a Certificate of Occupancy can be issued for a commercial building?
A mixed-use development requires a variance for reduced setbacks. The property is located within 500 feet of a hospital. What additional consideration must be addressed?
A LEED project requires tracking of regional materials. Materials are considered regional if they are extracted, harvested, or recovered, as well as manufactured within what distance of the project site?
People Also Study
Business & Financial Management
120 questions · 70% to pass
Project Management
60 questions · 70% to pass