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Major Types of Costs and Control

1) What are the major types of costs?
2) Which costs are controllable by the project manager?
3) Why is it important to separate contingency allowances from original estimates?
4) How does resource scheduling tie to project priority?

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1) What are the major types of costs?
There are three major types of costs direct (labor, materials, equipment, other); project overhead; and general and administrative (G&A) overhead.

2) Which costs are controllable by the project manager?
The project manager has the most control over direct costs. These are expenses that can be estimated or planned for during the course of the project: wages, equipment, training, meetings, transportation, publicity, advertising, etc.) The project manager has less, but some control over project overhead. For example, this includes his salary and the salary of those working on the project. Increasing or decreasing the amount of time spent on the project in ...

Solution Summary

The solution identifies and gives a short description of each type of cost. It shows which ones the project manager can control. It explains (one paragraph) why contingency allowances should be kept separate from original estimates. The final paragraph discusses how to tie resource scheduling to project priority.

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