Assignment 1 Imagine you work in the office of "Big Builders and Bob asks you to work on the Mount Hope Project. Prepare a professional memo for him stating the costs for the items listed below as well as the total project cost for the shopping facility in Mount Hope in the correct year. Use the information provided in the text you have read before and the additional information given below. You know that Big Builders has developed an essentially similar shopping facility in Splash Springs in 2003. You obtained the company's records from Bob and found that the actual costs for this shopping center were: Land 52.652.000 Stediment 5.080,000 alities ( Wed Sewer 5 22.000 Electrical reticulation $ 68.000 Shopping tayo. 2.2.000 6 Pasing lot(300 m) 50.000 Landscaping $70.000 8 Vanou Fees 5.000 Total project cost $9.725,000 The following construction cost indices were researched and will help determine the adjustment in price due to the difference in time and location of the two projects: Year Splash Springs Mount Hope 2003 Consider the following facts: Claire was able to purchase the land for $ 2,945,000 Construction is expected to start in 2018 . Assume a linear relationship of the costs based on the area of the floor plan. . The site selected will allow for 600 parking spaces and the cost of the parking lot is proportional to the number of parking spaces. . For the last half-year or so there has been an extreme shortage of companies specialized in installing electrical reticulations. Hence, it will be very difficult to find a subcontractor bidding a low price. Assume the unit cost of electrical price. Assume the unit cost of electrical reticulation in Mount Hope in the year 2013 will be 1.45 times the unit cost of Splash Springs in 2003. In addition, you know that the costs for electrical reticulation are directly proportional to the floor space. Landscaping costs are about 15% of the parking lot's construction cost due to Claire's concern about the appearance of the shopping facility in the community. Claire received an estimate for site development, which stated: "The site work should cost $2,135,000 at 2013 prices. You need to add an inflation allowance of 3.1% per year to this estimate if construction is to take place later than 2013." . For an annual inflation rate, assume a rate of 3.1% per year. . The item "various fees" will be 20% of the construction cost. Your memo should include: A table of the itemized costs The Mt. Hope project total - Any additional assumptions -A paragraph that answers the following questions: How accurate do you think your cost estimate is likely to be? What additional information do you need to improve the accuracy of your estimate? What information do you need if you are to give Claire an indication as to the feasibility of the venture from a technical and financial point of view? Attached to your memo: Calculations of the itemized costs Assignment 1 Imagine you work in the office of 'Big Builders and Bob asks you to work on the Mount Hope Project. Prepare a professional memo for him stating the costs for the items listed below as well as the total project cost for the shopping facility in Mount Hope in the correct year. Use the information provided in the text you have read before and the additional information given below. You know that Big Builders has developed an essentially similar shopping facility in Splash Springs in 2003. You obtained the company's records from Bob and found that the actual costs for this shopping center were: Land $ 2.057.000 2 Stediment $ 1.000.000 aines (Www Sewer 21,000 4 Electrical resolution 58.000 Shopping tools 3.928,000 Parking lot(300) 54.000 Landscaping $ 70.000 8 Vans Fees Total project cost $ 9,725,000 The following construction cost indices were researched and will help determine the adjustment in price due to the difference in time and location of the two projects: You Splash Springs Mount Hope 2003 2003 Consider the following facts: Claire was able to purchase the land for $ 2,945,000 Construction is expected to start in 2018 . Assume a linear relationship of the costs based on the area of the floor plan. . The site selected will allow for 600 parking spaces and the cost of the parking lot is proportional to the number of parking spaces. For the last half-year or so there has been an extreme shortage of companies specialized in installing electrical reticulations. Hence, it will be very difficult to find a subcontractor bidding a low price. Assume the unit cost of electrical very difficult to find a subcontractor bidding a low price. Assume the unit cost of electrical reticulation in Mount Hope in the year 2013 will be 1.45 times the unit cost of Splash Springs in 2003. In addition, you know that the costs for electrical reticulation are directly proportional to the floor space. Landscaping costs are about 15% of the parking lot's construction cost due to Claire's concern about the appearance of the shopping facility in the community Claire received an estimate for site development, which stated: "The site work should cost $2,135,000 at 2013 prices. You need to add an inflation allowance of 3.1% per year to this estimate if construction is to take place later than 2013." . For an annual inflation rate, assume a rate of 3.1% per year. The item "various fees" will be 20% of the construction cost. Your memo should include: A table of the itemized costs The Mt. Hope project total Any additional assumptions A paragraph that answers the following questions: How accurate do you think your cost estimate is likely to be? What additional information do you need to improve the accuracy of your estimate? What information do you need if you are to give Claire an indication as to the feasibility of the venture from a technical and financial point of view? Attached to your memo: Calculations of the itemized costs Assignment 1 Imagine you work in the office of "Big Builders and Bob asks you to work on the Mount Hope Project. Prepare a professional memo for him stating the costs for the items listed below as well as the total project cost for the shopping facility in Mount Hope in the correct year. Use the information provided in the text you have read before and the additional information given below. You know that Big Builders has developed an essentially similar shopping facility in Splash Springs in 2003. You obtained the company's records from Bob and found that the actual costs for this shopping center were: Land 52.652.000 Stediment 5.080,000 alities ( Wed Sewer 5 22.000 Electrical reticulation $ 68.000 Shopping tayo. 2.2.000 6 Pasing lot(300 m) 50.000 Landscaping $70.000 8 Vanou Fees 5.000 Total project cost $9.725,000 The following construction cost indices were researched and will help determine the adjustment in price due to the difference in time and location of the two projects: Year Splash Springs Mount Hope 2003 Consider the following facts: Claire was able to purchase the land for $ 2,945,000 Construction is expected to start in 2018 . Assume a linear relationship of the costs based on the area of the floor plan. . The site selected will allow for 600 parking spaces and the cost of the parking lot is proportional to the number of parking spaces. . For the last half-year or so there has been an extreme shortage of companies specialized in installing electrical reticulations. Hence, it will be very difficult to find a subcontractor bidding a low price. Assume the unit cost of electrical price. Assume the unit cost of electrical reticulation in Mount Hope in the year 2013 will be 1.45 times the unit cost of Splash Springs in 2003. In addition, you know that the costs for electrical reticulation are directly proportional to the floor space. Landscaping costs are about 15% of the parking lot's construction cost due to Claire's concern about the appearance of the shopping facility in the community. Claire received an estimate for site development, which stated: "The site work should cost $2,135,000 at 2013 prices. You need to add an inflation allowance of 3.1% per year to this estimate if construction is to take place later than 2013." . For an annual inflation rate, assume a rate of 3.1% per year. . The item "various fees" will be 20% of the construction cost. Your memo should include: A table of the itemized costs The Mt. Hope project total - Any additional assumptions -A paragraph that answers the following questions: How accurate do you think your cost estimate is likely to be? What additional information do you need to improve the accuracy of your estimate? What information do you need if you are to give Claire an indication as to the feasibility of the venture from a technical and financial point of view? Attached to your memo: Calculations of the itemized costs Assignment 1 Imagine you work in the office of 'Big Builders and Bob asks you to work on the Mount Hope Project. Prepare a professional memo for him stating the costs for the items listed below as well as the total project cost for the shopping facility in Mount Hope in the correct year. Use the information provided in the text you have read before and the additional information given below. You know that Big Builders has developed an essentially similar shopping facility in Splash Springs in 2003. You obtained the company's records from Bob and found that the actual costs for this shopping center were: Land $ 2.057.000 2 Stediment $ 1.000.000 aines (Www Sewer 21,000 4 Electrical resolution 58.000 Shopping tools 3.928,000 Parking lot(300) 54.000 Landscaping $ 70.000 8 Vans Fees Total project cost $ 9,725,000 The following construction cost indices were researched and will help determine the adjustment in price due to the difference in time and location of the two projects: You Splash Springs Mount Hope 2003 2003 Consider the following facts: Claire was able to purchase the land for $ 2,945,000 Construction is expected to start in 2018 . Assume a linear relationship of the costs based on the area of the floor plan. . The site selected will allow for 600 parking spaces and the cost of the parking lot is proportional to the number of parking spaces. For the last half-year or so there has been an extreme shortage of companies specialized in installing electrical reticulations. Hence, it will be very difficult to find a subcontractor bidding a low price. Assume the unit cost of electrical very difficult to find a subcontractor bidding a low price. Assume the unit cost of electrical reticulation in Mount Hope in the year 2013 will be 1.45 times the unit cost of Splash Springs in 2003. In addition, you know that the costs for electrical reticulation are directly proportional to the floor space. Landscaping costs are about 15% of the parking lot's construction cost due to Claire's concern about the appearance of the shopping facility in the community Claire received an estimate for site development, which stated: "The site work should cost $2,135,000 at 2013 prices. You need to add an inflation allowance of 3.1% per year to this estimate if construction is to take place later than 2013." . For an annual inflation rate, assume a rate of 3.1% per year. The item "various fees" will be 20% of the construction cost. Your memo should include: A table of the itemized costs The Mt. Hope project total Any additional assumptions A paragraph that answers the following questions: How accurate do you think your cost estimate is likely to be? What additional information do you need to improve the accuracy of your estimate? What information do you need if you are to give Claire an indication as to the feasibility of the venture from a technical and financial point of view? Attached to your memo: Calculations of the itemized costs
