Question: ustom Homebuilders (CH) designs and constructs high-end homes on large lots owned by customers. CH has developed several formulas, which it uses to quote jobs.
ustom Homebuilders (CH) designs and constructs high-end homes on large lots owned by customers. CH has developed several formulas, which it uses to quote jobs. These include costs for materials, labor, and other costs. These estimates are also dependent on the region of the country a particular customer lives. Below are the cost estimates for one region in the Midwest:
| Administrative costs | $ | 20,000 | |
| Building costs per square foot (basic) | $ | 90 | |
| Building costs per square foot (moderate) | $ | 150 | |
| Building costs per square foot (luxury) | $ | 225 | |
| Appliances (basic) | $ | 15,000 | |
| Appliances (moderate) | $ | 25,000 | |
| Appliances (luxury) | $ | 45,000 | |
| Utilities costs (if required) | $ | 40,000 | |
Required:
A customer has expressed interest in having CH build a moderate, 3,000 square-foot home on a vacant lot, which does not have utilities. Based on the engineering estimates above, what will such a house cost to build?
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The answer is 20000+450000+25000+40000=535000. I still don't get it why utility cost is included in the answer, even though the home does not have utilities. Why is it included?
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