Chapter 2 Quiz

1. What is the purpose of working?
   to make money
   to spend money
   to help your boss make money
   none of the above

2. What is the purpose of job costing?
   tracking employee time
   using spreadsheets
   managing costs, ensuring profit
   increasing expenses

3. What does an estimator do?
   forecasts the weather
   appraises home value
   estimates time and cost required for a job
   all of the above

4. What items can be considered direct costs for a construction job?
   office supplies, rent payment
   insurance
   car maintenance
   nails, lumber

5. What items can be considered indirect costs?
   office rent
   administrative staff payroll
   office electrical bill
   All of the Above

6. An overhead rate allows you to:
   purchase extended car warranty
   allocate overhead expenses to multiple jobs
   find total direct costs
   save 15% on insurance

7. One way to calculate overhead rate is:
   Total Overhead / Total Direct Costs
   Total Direct Costs / Total Overhead
   Direct Costs / Indirect Costs
   none of the above

8. A unique identification number is assigned to each expense. What is it called?
   expense ID
   cost ID
   cost code
   liabilities

9. What is a profit margin?
   revenue minus expenses
   a percentage of your profits, subtracted from expenses
   a percentage of your costs, added as profit
   none of the above

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