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Questions and Answers
Which of the following is NOT considered an element of cost?
Which of the following is NOT considered an element of cost?
- Cost Classifications
- Cost Types
- Cost Dimensions
- Cost Reduction Strategies (correct)
What is the primary purpose of the AACE International CCT primer?
What is the primary purpose of the AACE International CCT primer?
- To provide exam questions for the CCT certification
- To replace practical experience in cost techniques
- To assist individuals in preparing for the CCT exam (correct)
- To outline the history of AACE certifications
Which topic falls under the elements of analysis?
Which topic falls under the elements of analysis?
- Statistics and Probability (correct)
- Cost Estimating
- People and Organizations in Enterprises
- Quality Management
What is a key limitation of the CCT primer?
What is a key limitation of the CCT primer?
Which area is NOT mentioned as enabling knowledge in the CCT primer?
Which area is NOT mentioned as enabling knowledge in the CCT primer?
Which element under cost includes all pricing strategies?
Which element under cost includes all pricing strategies?
Which of the following categories pertains to the topic of enterprise within society?
Which of the following categories pertains to the topic of enterprise within society?
Where can individuals find the minimum requirements for AACE certifications?
Where can individuals find the minimum requirements for AACE certifications?
What distinguishes overhead costs from direct costs?
What distinguishes overhead costs from direct costs?
Which of the following best describes General and Administrative (G&A) costs?
Which of the following best describes General and Administrative (G&A) costs?
Which statement is true regarding utilities in a business context?
Which statement is true regarding utilities in a business context?
Gross Profit is calculated by which of the following formulas?
Gross Profit is calculated by which of the following formulas?
What is the primary characteristic of burden costs?
What is the primary characteristic of burden costs?
Which of the following best classifies costs such as administration and insurance?
Which of the following best classifies costs such as administration and insurance?
How can overheads impact a company's financial assessment?
How can overheads impact a company's financial assessment?
What is a key challenge associated with overhead costs?
What is a key challenge associated with overhead costs?
What is the primary characteristic of Fair Market Value-in-Place?
What is the primary characteristic of Fair Market Value-in-Place?
Which scenario best describes Fair Market Value-in-Exchange?
Which scenario best describes Fair Market Value-in-Exchange?
What time frame is typically considered for determining Orderly Liquidation Value?
What time frame is typically considered for determining Orderly Liquidation Value?
In the context of Fair Market Value-in-Place, which factor is emphasized?
In the context of Fair Market Value-in-Place, which factor is emphasized?
What distinguishes Fair Market Value-in-Exchange from Fair Market Value-in-Place?
What distinguishes Fair Market Value-in-Exchange from Fair Market Value-in-Place?
How is Orderly Liquidation Value generally realized?
How is Orderly Liquidation Value generally realized?
Which aspect is NOT a requirement for Fair Market Value-in-Place?
Which aspect is NOT a requirement for Fair Market Value-in-Place?
What is often referred to as the retail value in asset valuation?
What is often referred to as the retail value in asset valuation?
What is the definition of direct costs in construction?
What is the definition of direct costs in construction?
Which of the following best describes distributable cost?
Which of the following best describes distributable cost?
What is escalation in terms of construction costs?
What is escalation in terms of construction costs?
Which of the following is NOT considered a direct cost during construction?
Which of the following is NOT considered a direct cost during construction?
What aspect does escalation NOT pertain to in cost management?
What aspect does escalation NOT pertain to in cost management?
Which of the following best distinguishes between a cost index and historical cost analysis?
Which of the following best distinguishes between a cost index and historical cost analysis?
How do supply-and-demand factors influence escalation in construction costs?
How do supply-and-demand factors influence escalation in construction costs?
Which of the following best defines the relationship between direct costs and overhead costs?
Which of the following best defines the relationship between direct costs and overhead costs?
What is the primary purpose of a performance bond?
What is the primary purpose of a performance bond?
Retention funds are typically used to ensure what aspect of contract work?
Retention funds are typically used to ensure what aspect of contract work?
Which type of bond guarantees that a bidder will agree to a contract based on their bid?
Which type of bond guarantees that a bidder will agree to a contract based on their bid?
The actual rates for performance bonds depend on what factors?
The actual rates for performance bonds depend on what factors?
What is the primary function of a payment bond?
What is the primary function of a payment bond?
Before awarding a contract, what should be verified about a contractor?
Before awarding a contract, what should be verified about a contractor?
What does retainer typically refer to in construction contracts?
What does retainer typically refer to in construction contracts?
What should contractors be aware of regarding bonding companies?
What should contractors be aware of regarding bonding companies?
Flashcards
What are elements of cost?
What are elements of cost?
Resources consumed to complete a process; often called 'burden cost.'
How are costs classified?
How are costs classified?
Direct costs are tied directly to a specific project or activity, while indirect costs are general and support multiple projects.
What is pricing?
What is pricing?
Setting values for goods and services. Essential for cost estimation and bidding.
How is project cost estimated?
How is project cost estimated?
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What is the role of statistics and probability in cost management?
What is the role of statistics and probability in cost management?
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What is economic and financial analysis?
What is economic and financial analysis?
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What are optimization and models?
What are optimization and models?
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What is physical measurement?
What is physical measurement?
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What is the role of 'enterprise in society'?
What is the role of 'enterprise in society'?
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What are 'people and organizations' in terms of cost management?
What are 'people and organizations' in terms of cost management?
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What role does 'information management' play in cost management?
What role does 'information management' play in cost management?
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What is 'quality management' in cost management?
What is 'quality management' in cost management?
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What is 'value management' in cost management?
What is 'value management' in cost management?
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What is Fair Market Value-in-Place?
What is Fair Market Value-in-Place?
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What is Fair Market Value-in-Exchange?
What is Fair Market Value-in-Exchange?
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What is Orderly Liquidation Value?
What is Orderly Liquidation Value?
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What are General and Administrative Costs (G&A)?
What are General and Administrative Costs (G&A)?
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What is Gross Profit?
What is Gross Profit?
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What are Performance Bonds?
What are Performance Bonds?
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What are Bid Bonds?
What are Bid Bonds?
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What are Payment Bonds?
What are Payment Bonds?
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What is Retention (Retainage)?
What is Retention (Retainage)?
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What is a Cost Index?
What is a Cost Index?
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What are Direct Costs?
What are Direct Costs?
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What are Distributable Costs?
What are Distributable Costs?
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What is Escalation?
What is Escalation?
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Study Notes
AACE International CCT Certification Overview
- AACE International provides a primer to assist candidates in preparing for the Certified Cost Technician (CCT) exam.
- This primer should complement, not replace, actual knowledge and experience in cost management.
Elements of Cost
- Cost Definitions: Resource consumed in completing a process, known as burden cost.
- Cost Classifications: Costs categorized into direct, indirect, fixed, and variable, among others.
- Pricing: Establishing values for goods and services, essential for cost estimation and contract bidding.
- Cost Estimating: Process of forecasting the probable costs for a project.
Elements of Analysis
- Statistics and Probability: Tools used to interpret data and assess risks within cost management.
- Economic and Financial Analysis: Evaluates the financial viability of projects, considering cash flow and budget impacts.
- Optimization and Models: Techniques used to maximize efficiency and minimize costs in projects.
- Physical Measurement: Quantitative assessment of project progress and resource utilization.
Enabling Knowledge
- Enterprise in Society: Understanding the societal role of organizations and economic impact on cost management.
- People and Organizations: Dynamics that impact project success, including team functionality and stakeholder engagement.
- Information Management: Technologies and processes for handling data crucial for informed decision-making.
- Quality Management: Systems ensuring that services meet standards, affecting overall cost and efficiency.
- Value Management: Assessment of project value creation relative to costs.
Fair Market Values
- Fair Market Value-in-Place: Expected trade value of an asset at a specific time, considering installation and operational contribution.
- Fair Market Value-in-Exchange: Retail value of equipment expected from a third-party transaction.
- Orderly Liquidation Value: Estimated price from a planned sale of capital assets within six months.
General and Administrative Costs (G&A)
- Fixed costs related to overall business operations, which are not tied to specific projects, but occur continuously.
- Includes expenses for offices, staffing, and utilities.
Profit Calculations
- Gross Profit: Revenue remaining after direct and project indirect costs are deducted from sales.
- Considers overhead, profit margins, and operational expenses.
Bonds and Retention
- Performance Bonds: Insurance guaranteeing contractor completion of work, influencing contract awards.
- Bid Bonds: Guarantees entry into contract based on bid.
- Payment Bonds: Ensures labor and materials are paid during project execution.
- Retention (Retainage): A percentage of the contract value held until project completion and satisfactory testing.
Cost Index and Direct Costs
- Cost Index: Relates past costs to current costs for better estimating and analysis.
- Direct Costs: Expenses directly attributable to specific activities or items essential for project completion.
- Distributable Costs: Costs allocated across multiple items instead of managed separately.
Escalation in Costs
- Escalation: Adjustment for increases in costs over time due to factors like inflation and market demand.
- Provides a provision for cost changes in contracts and purchase orders over the duration of a project.
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Description
This quiz is designed to help young professionals prepare for the AACE International Certified Cost Technician (CCT) certification. It emphasizes the importance of meeting the current minimum requirements laid out by AACE. Ensure you review the necessary knowledge and experience as part of your preparation.
