Z94.4 - Cost Engineering & Project Management
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MAINTENANCE AND REPAIR COST. The total of labor, material, and other related costs incurred in conducting corrective and preventative maintenance and repair on a facility, on its systems and components, or on both. Maintenance does not usually include those items that cannot be expended within the year purchased. Such items must be considered as fixed capital.
MAJOR COMPONENTS. Part of the aggregation structure of a price index (eg, a CPI can be subdivided into major components of food, housing, clothing, transportation, health and personal care, recreation, reading and education, tobacco and alcohol).
MAJOR MILESTONE. The most significant milestones in the project’s life or duration, representing major accomplishments or decision points; usually associated with the first breakdown level in the work breakdown structure.
MAJOR SYSTEM ACQUISITION PROJECTS. Those projects that are directed at and are critical to fulfilling a mission, entail the allocation of relatively large resources, and warrant special management attention.
MANUFACTURING COST. The total of variable and fixed or direct and indirect costs chargeable to the production of a given product, usually expressed in cents or dollars per unit of production, or dollars per year. Transportation and distribution costs, and research, development, selling and corporate administrative expenses are usually excluded. (See also OPERATING COSTS).
MARGINAL ANALYSIS. An economic concept concerned with those incremental elements of costs and revenue which are associated directly with a specific course of action, normally using available Current costs and revenue as a base and usually independent of traditional accounting allocation procedures.
MARGINAL COST (BENEFIT). (See INCREMENTAL COSTS (BENEFIT).)
MARKET VALUE. The monetary price upon which a willing buyer and a willing seller in a free market will agree to exchange ownership, both parties knowing all the material facts but neither being compelled to act. The market value fluctuates with the degree of willingness of the buyer and seller and with the conditions of the sale. The use of the term market suggest the idea of barter. When numerous sales occur on the market, the result is to establish fairly definite market prices as the basis of exchanges.
MARK UP. As variously used in construction estimating, includes such percentage applications as general overhead, profit, and other indirect costs. When mark-up is applied to the bottom of a bid sheet for a particular item, system, or other construction price, any or all of the above items (or more) may be included, depending on local practice.
MATERIAL COST. The cost of everything of a substantial nature that is essential to the construction or operation of a facility, both of a direct or indirect nature. Generally includes all manufactured equipment as a basic part.
MATERIAL DIFFERENCE. A change that is important to the performance of the work or that will have a measurable influence or effect on the time, cost of, or procedures for the work under the contract.
MAXIMUM OUT-OF-POCKET CASH. The highest year-end negative cash balance during project life.
MECHANICAL COMPLETION. Placing a fixed asset in service. Mechanical completion is an event.
MERIT SHOP. (See OPEN SHOP).
METHOD OF PERFORMANCE. The manner in which the specified product or objective is accomplished, which is left to the discretion of the contractor unless otherwise provided in the contract. If the owner or the engineer orders the contractor to modify the construction procedure, this constitutes a change in method. If the imposition of this modification results in additional cost to the contractor, the contractor may be entitled to recovery under the changes clause.
MILESTONE. An important or critical event and/or activity that must occur when scheduled in the project cycle in order to achieve the project objective(s).
MILESTONE FLAG. A numeric code that may be entered on an event to flag the event as a milestone.
MILESTONE LEVEL. The level of management at which a particular event is considered to be a key event or milestone.
MILESTONE REPORT. An output report at a specified level showing the latest allowable date, expected date, schedule completion date, and the lack for the successor event contained on each activity or event name flagged as a milestone at the level specified.
MILESTONE SCHEDULE. A schedule comprised of key events or milestones elected as a result of coordination between the clients and the contractor’s project management. These events are generally critical accomplishments planned at time intervals throughout the project and used as a basis to monitor overall project performance. The format may be either network or bar chart and may contain minimal detail at a highly summarized level.
MISREPRESENTATION. Inaccurate factual information furnished by either party to a contract, even if done unintentionally.
MITIGATION OF DAMAGES. To take all possible measures to avoid damage and delay and, if not avoidable, to reduce or lessen the extra costs incurred due to occurrence of the event.
MODEL PRICING. The techniques of using verbal, symbolic, or analog models to depict cost relationships, and the form which they take. Mathematics and digital computers are basic analytical tools for model pricing.
MODIFICATION, BILATERAL. An agreement negotiated by and entered into by both parties for a modification of the existing contract terms of a mutually agreed time or price adjustment.
MODIFICATION, UNILATERAL. A modification to the contract issued by the owner without the agreement of the contractor as to the time or price adjustment.
MONITORING. Periodic gathering, validating and analyzing various data on contract status to determine any existing or potential problems. Usually one accomplishes this through use of the data provided in contractor reports on schedule, labor, cost and technical status to measure progress against the established baselines for each of these report areas. However, when deemed necessary, on-site inspection and validation and other methods can be employed.
MONTHLY GUIDE SCHEDULE. A detailed two-month schedule used to detail the sequence of activities in an area for analysis or to plan work assignments. This schedule is usually prepared on an “as needed” basis or within a critical area. Syn: Short-Term Activities.
MONTH-TO-MONTH PRICE INDEX. A price index for a given month with the preceding month as the base period.
MOST LIKELY TIME ESTIMATE. The most realistic estimate of the time an activity might consume.
MOVING AVERAGE. Smoothing a time series by replacing a value with the mean of itself and adjacent values.
MULTIPLE FINISH NETWORK. A network that has more than one finish activity or finish event.
MULTIPLE START NETWORK. A network that has more than one start activity or event.
MULTIPLE STRAIGHT-LINE DEPRECIATION METHOD. A method of depreciation accounting in which two or more straight line rates are used. This method permits a predetermined portion of the asset to be written off in a fixed number of years. One common practice is to employ a straight line rate which will write off 3/4 of the cost in the first half of the anticipated service life; with a second straight line rate to write off the remaining 1/4 in the remaining half life.
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