Construction Financial Glossary

Project Cost Breakdown Definition

A project cost breakdown is a detailed summary of all expenses associated with a construction project, categorized by cost type. It helps owners and contractors monitor spending and ensure financial transparency.

Why a Cost Breakdown is Important

By organizing costs into specific categories, a project cost breakdown improves budgeting accuracy and helps identify potential savings.

Common Cost Breakdown Categories

    1. Labor costs, including wages, payroll taxes, and benefits
    2. Material costs for concrete, steel, and other building supplies
    3. Equipment costs such as rentals and maintenance


Related Terms: Cost Breakdown Structure (CBS) (CBS), Job Costing, Earned Value Analysis, Budget Variance

FAQs

How is a project cost breakdown different from a budget?

A: A budget is an estimate, while a cost breakdown details actual and allocated expenses.

Why is tracking cost breakdowns important?

A: It helps prevent overruns and ensures financial accountability.

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