Dog Exercise 5-27 (Algo) Methods of Estimating Costs: Engineering Estimates (LO 5-1, 2)Collingwood Contractors (CC) designs and builds new model homes for individual customers. CC has developed a reputation in themarket for relatively upscale, unique designs with high-end finishings. CC has developed several formulas, which it uses to estimatecosts and provide price quotes for prospective buyers. These include costs for materials, labor, and other resources. Although multipleconfigurations are possible for any house, CC uses three levels (or tiers) to represent increasing levels of luxury in terms of materialsused. In addition, the customer can choose among three levels of increasingly sophisticated appliances and other house equipment.Finally, there is cost to bring utilities (electricity, water, and so on) to the house if required. Of course, these estimates are dependenton the region of the country and whether the lot is located in a city or in a suburb or rural area. If the building site is in a city, a premiumis added based on the building and equipment costs. The following are the cost estimates for one region in the Northwest:Design and administrative costsBuilding costs per square foot (Tier I)Building costs per square foot (Tier II)Building costs per square foot (Tier III)Equipment (appliances, and so on) -- RubyEquipment (appliances, and so on) - SapphireEquipment (appliances, and so on) -- EmeraldUtilities required? If yes, ...City premium (applied to building and equipment costs)Required:a. A customer has expressed interest in having CC build a Tier III, 5,100-square-foot home. The building site is a city lot and thecustomer wants the Sapphire level equipment. Based on the engineering estimates above, what will such a house cost to build? Noadditional utilities access is required.Complete this question by entering your answers in the tabs below.b. Another customer has expressed interest in having CC build a smaller, Tier I, home, but with emerald-level equipment. This homewill be on a vacant lot in the country and require utilities access to be added. The customer has chosen a 2,800-square-foot design.Based on the engineering estimates above, what will such a house cost to build?Design costsBuilding costsEquipment costsRequired ARequired BA customer has expressed interest in having CC build a Tier III, 5,100-square-foot home. The building site is a city lot and thecustomer wants the Sapphire level equipment. Based on the engineering estimates above, what will such a house cost tobuild? No additional utilities access is required.City premiumUtilities (if required)Estimated cost$ 41,000116186241$21,00030,00039,00042,00010%< Required ARequired B >

The total cost of building is the sum of design and administrative costs, building costs, equipment…

Collingwood Contractors (CC) designs and builds new model homes for individual customers. CC has developed a reputation in the market for relatively upscale, unique designs with high-end finishings. CC has developed several formulas, which it uses to estimate costs and provide price quotes for prospective buyers. These include costs for materials, labor, and other resources. Although multiple configurations are possible for any house, CC uses three levels (or tiers) to represent increasing levels of luxury in terms of materials used. In addition, the customer can choose among three levels of increasingly sophisticated appliances and other house equipment. Finally, there is cost to bring utilities (electricity, water, and so on) to the house if required. Of course, these estimates are dependent on the region of the country and whether the lot is located in a city or in a suburb or rural area. If the building site is in a city, a premium is added based on the building and equipment costs. The following are the cost estimates for one region in the Northwest:

Collingwood Contractors (CC) designs and builds new model homes for individual customers. CC has developed a reputation in the market for relatively upscale, unique designs with high-end finishings. CC has developed several formulas, which it uses to estimate costs and provide price quotes for prospective buyers. These include costs for materials, labor, and other resources. Although multiple configurations are possible for any house, CC uses three levels (or tiers) to represent increasing levels of luxury in terms of materials used. In addition, the customer can choose among three levels of increasingly sophisticated appliances and other house equipment. Finally, there is cost to bring utilities (electricity, water, and so on) to the house if required. Of course, these estimates are dependent on the region of the country and whether the lot is located in a city or in a suburb or rural area. If the building site is in a city, a premium is added based on the building and equipment costs. The following are the cost estimates for one region in the Northwest:

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter6: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 5E: Identify fixed and variable costs Intuit Inc. (INTU) develops and sells software products for the...

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