PROJ-1009 Project Management

Classroom Activity 2 - Defining the Project

Please complete each of the three following questions and submit in the dropbox on the due date.

Calculate the total direct costs of labor for a project team member using the following data:

Hourly rate: $40/hr

Hours needed: 80

Overhead rate: 40%

Answer: $4,480

Below is a project WBS with cost apportioned by percent. If the total project cost is estimated to be $600,000, what are the estimated costs for the following deliverables?

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	Answer
Design cost	$240,000
Programming cost	$48,000
In-house testing cost	$240,000

Mrs. Tolstoy and her husband, Serge, are planning their dream house. The lot for the house sits high on a hill with a beautiful view of the Appalachian Mountains. The plans for the house show the size of the house to be 2,900 square feet. The average price for a lot and house similar to this one has been $120 per square foot. Fortunately, Serge is a retired plumber and feels he can save money by installing the plumbing himself. Mrs. Tolstoy feels she can take care of the interior decorating.

The following average cost information is available from a local bank that makes loans to local contractors and disperses progress payments to contractors when specific tasks are verified as complete.

24%	Excavation and framing complete
8%	Roof and fireplace complete
3%	Wiring roughed in
6%	Plumbing roughed in
5%	Siding on
17%	Windows, insulation, walks, plaster, and garage complete
9%	Furnace installed
4%	Plumbing fixtures installed
10%	Exterior paint, light fixtures installed, finish hardware installed
6%	Carpet and trim installed
4%	Interior decorating
4%	Floors laid and finished

a. What is the estimated cost for the Tolstoys house if they use contractors to complete all of the house?

Answer: ______________________________________________

b. Estimate what the cost of the house would be if the Tolstoys use their talents to do some of the work themselves.

Answer: ______________________________________________