Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
net multiplier = - ansnet revenue / DSE
net revenue - anstotal revenue generated by the firm's own forces
doesn't include pass-thru income such as consultant fees and reimbursable expenses
why is it important to keep the design and FEE contracts separate? - ansso architect has no
monetary interest in the sale of goods that they specified
tort - ansA civil wrong resulting from negligence
*not a criminal act
how often should you monitor a project's budget and schedule? - answeekly - gives enough
time to correct issues before they are in the past
what would you use to determine the profitability and financial standing of the firm? - ansnet
multiplier
what would you use to judge the financial health of a firm but is not directly related to billing
rates? - ansquick ratio
why is getting paid critical for cash flow? - ansyou have bills to pay and salaries to pay so
you need income to sustain those expenses
if the arch knows a developer's project schedule is unreasonable, what should they do? -
ansturn down the project unless the schedule is changed or the scope is reduced
what is an indemnification clause and where can you find one? - ansattempts to hold harmless
the owner and arch for any claims resulting from the work by contractor or subs with whom
the arch has no contractual relationship
A201
What does workers compensation cover? - ansmedical costs and a PORTION of lost wages
when there are multiple contractors, what is the arch's duty? - ansassist owner in coordinating
req'ts and schedules
provisions for copyright are in ___ - ansB101
best way to ensure copyright protection - ansplace a copyright notice on each printed item
and register them with the US copyright office
ideal current ratio and what it measures - ansfirm's ability to meet current obligations
current assets / current liabilities
minimum 1.0 - 1.5
,Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
higher the better
how can you minimize risks and establish consistent procedures for producing work? -
answell-implemented quality control program
how can you identify time and fee problems early enough to take corrective action? -
ansmonitor project progress reports more closely
architectural fee is $100,000. two employees make $25 per hour each. how many hours total
should they work on SD? - ans$100,000 x 0.15 = $15,000 on SD
$15, (generic net multiplier) = $5,000
$5000 / $25 = 200 hours
payout system - anshow the contractor gets paid for the work
owner has right to all _____ if the owner-architect relationship goes bad - ansinstruments of
service
joinder - anscombining two legal issues together (two parties' arbitration cases, etc)
project alliance - ansaka multi-party agreement
-used w IPD
-allows for payment of direct costs but overhead, profit, and bonus depends on successful
project completion
-participants waive liability to each other
-no dispute resolution stated bc all decisions made by consensus
in a standard IPD method (relational contract model), who holds the contracts w the subs and
consultants? - anscontractor
arch
single purpose entity - ansIndependent LLC newly created for the sole purpose of developing
a particular project in IPD
-must consider all parts of this new business (taxes, insurance, setup fees, etc)
-payment of direct costs allowed, but profit, overhead, and bonuses are only when project is
successfully completed
-liability is limited (LLC)
-disputes thru negotiation, mediation, arbitration, litigation
relational contract - ans-contracts bt owner and someone for an IPD method (owner and
contractor, owner and architect)
-limit the parties' liability, but NOT waived
,Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
-if consensus is not achieved, owner must make final decisions
-compensation for direct costs, profit, overhead is allowed but bonus is only after successful
completion
-disputes thru negotiation, arbitration, mediation, litigation
-most similar to traditional design-build method
who owns the building? who owns the copyright on the building? - ansowner
architect
AIA G612: Owner's instructions to the architect re: the construction contract
includes what? - ans"the owner shall provide the arch with insurance and bonds req'ts for the
project for inclusion in the bidding docs. the owner is responsible for providing the arch with
completed insurance and bonds to satisfy requirements. the owner is encouraged to consult
with its legal council to establish req'ts"
BASICALLY SAYS OWNER GO ASK YOUR LAWYER
what happens if you have a teaming agreement and a JV but the project you planned to use it
on falls through? - ansassuming this provision is in the teaming agreement, the agreement and
JV would not be formed or it would dissolve, with no adverse affect to either firm
what must a firm primarily consider when thinking about entering a competition? -
ansstaffing and money - can you afford to spend time on a proposal and do you have enough
experienced staff to do it?
*some of the cost can be offset if the organizer is offering compensation for any firms that
enter the competition, but it's uncommon
(while you can consider other projects that the firm is working on, you must have staff first
before you consider if that staff is available)
whose responsibility is it to create the sustainability objective and the sustainability plan? -
ansobjective - owner
plan - architect
staffing level req'd throughout a project - anslow at beginning, higher in CD
overtime and extra staff usually not needed at beginning
the best time for an architectural firm to begin minimizing risk w clients is during ___. Why?
- ansmarketing
, Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
don't market to ppl that don't fit your firm's goals/experience/values or you will be bringing
your firm more risk
-example: if you are a midsize firm in the US w no foreign experience, don't market to an
overseas developer
liability for professional corporation vs LLC/LLP. If you want to minimize risk, what
structure would you use? - ansprofessional corp liability is limited to the person who did the
malpractice/negligence
LLC/LLP limits liability to the amount of your investment in the company. no personal
liability.
*use LLC/LLP to minimize risk b/c your risk is limited to your investment. in professional
corporation, your risk isn't limited if you're the one who was negligent
when would you use a studio organization that has specialist departments? - ansin a very
large firm - when you can have separate departments for design, construction docs, and CA
(what's the difference bt this and horizontal then?)
squatter's session - ansintense, multi-day group meeting with the architects, client, and users
of the building being programmed and designed
C401 says what re: coordination of work? - ansconsultant must coordinate their services with
the arch and other consultants (NOT the architect's responsibility)
why would you hire an outside spec writer for a midsize general firm doing multiple project
types instead of using a subscription service for specs? - ans-third party spec writer can
customize the firm's specs to each project
-cost of the spec writer's fees can be passed on to the client with markup for coordination
-firm would not have to pay taxes and benefits bc the spec writer is an outside consultant, not
an employee
who would you consult first for vertical transportation solutions in a midrise city courthouse
project? - anselevator consultant - they are the common denominator b/t the facility manager,
security consultant, and elec engineer
(ARE doesn't expect you to know security concerns of a courthouse)
if the budget is very unrealistic and unfeasible, what AIA code of ethics is violated if you
accept the project? - ansnone - but you're screwing yourself over
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
net multiplier = - ansnet revenue / DSE
net revenue - anstotal revenue generated by the firm's own forces
doesn't include pass-thru income such as consultant fees and reimbursable expenses
why is it important to keep the design and FEE contracts separate? - ansso architect has no
monetary interest in the sale of goods that they specified
tort - ansA civil wrong resulting from negligence
*not a criminal act
how often should you monitor a project's budget and schedule? - answeekly - gives enough
time to correct issues before they are in the past
what would you use to determine the profitability and financial standing of the firm? - ansnet
multiplier
what would you use to judge the financial health of a firm but is not directly related to billing
rates? - ansquick ratio
why is getting paid critical for cash flow? - ansyou have bills to pay and salaries to pay so
you need income to sustain those expenses
if the arch knows a developer's project schedule is unreasonable, what should they do? -
ansturn down the project unless the schedule is changed or the scope is reduced
what is an indemnification clause and where can you find one? - ansattempts to hold harmless
the owner and arch for any claims resulting from the work by contractor or subs with whom
the arch has no contractual relationship
A201
What does workers compensation cover? - ansmedical costs and a PORTION of lost wages
when there are multiple contractors, what is the arch's duty? - ansassist owner in coordinating
req'ts and schedules
provisions for copyright are in ___ - ansB101
best way to ensure copyright protection - ansplace a copyright notice on each printed item
and register them with the US copyright office
ideal current ratio and what it measures - ansfirm's ability to meet current obligations
current assets / current liabilities
minimum 1.0 - 1.5
,Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
higher the better
how can you minimize risks and establish consistent procedures for producing work? -
answell-implemented quality control program
how can you identify time and fee problems early enough to take corrective action? -
ansmonitor project progress reports more closely
architectural fee is $100,000. two employees make $25 per hour each. how many hours total
should they work on SD? - ans$100,000 x 0.15 = $15,000 on SD
$15, (generic net multiplier) = $5,000
$5000 / $25 = 200 hours
payout system - anshow the contractor gets paid for the work
owner has right to all _____ if the owner-architect relationship goes bad - ansinstruments of
service
joinder - anscombining two legal issues together (two parties' arbitration cases, etc)
project alliance - ansaka multi-party agreement
-used w IPD
-allows for payment of direct costs but overhead, profit, and bonus depends on successful
project completion
-participants waive liability to each other
-no dispute resolution stated bc all decisions made by consensus
in a standard IPD method (relational contract model), who holds the contracts w the subs and
consultants? - anscontractor
arch
single purpose entity - ansIndependent LLC newly created for the sole purpose of developing
a particular project in IPD
-must consider all parts of this new business (taxes, insurance, setup fees, etc)
-payment of direct costs allowed, but profit, overhead, and bonuses are only when project is
successfully completed
-liability is limited (LLC)
-disputes thru negotiation, mediation, arbitration, litigation
relational contract - ans-contracts bt owner and someone for an IPD method (owner and
contractor, owner and architect)
-limit the parties' liability, but NOT waived
,Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
-if consensus is not achieved, owner must make final decisions
-compensation for direct costs, profit, overhead is allowed but bonus is only after successful
completion
-disputes thru negotiation, arbitration, mediation, litigation
-most similar to traditional design-build method
who owns the building? who owns the copyright on the building? - ansowner
architect
AIA G612: Owner's instructions to the architect re: the construction contract
includes what? - ans"the owner shall provide the arch with insurance and bonds req'ts for the
project for inclusion in the bidding docs. the owner is responsible for providing the arch with
completed insurance and bonds to satisfy requirements. the owner is encouraged to consult
with its legal council to establish req'ts"
BASICALLY SAYS OWNER GO ASK YOUR LAWYER
what happens if you have a teaming agreement and a JV but the project you planned to use it
on falls through? - ansassuming this provision is in the teaming agreement, the agreement and
JV would not be formed or it would dissolve, with no adverse affect to either firm
what must a firm primarily consider when thinking about entering a competition? -
ansstaffing and money - can you afford to spend time on a proposal and do you have enough
experienced staff to do it?
*some of the cost can be offset if the organizer is offering compensation for any firms that
enter the competition, but it's uncommon
(while you can consider other projects that the firm is working on, you must have staff first
before you consider if that staff is available)
whose responsibility is it to create the sustainability objective and the sustainability plan? -
ansobjective - owner
plan - architect
staffing level req'd throughout a project - anslow at beginning, higher in CD
overtime and extra staff usually not needed at beginning
the best time for an architectural firm to begin minimizing risk w clients is during ___. Why?
- ansmarketing
, Comprehensive ARE Practice Problems -
DONE, PcM Practice Exam Study, DIVISION 1
- (PcM) PRACTICE MANAGEMENT, ARE |
PcM | M1, ARE | PcM | M2, Financial
Equations, ARE 5.0 - PcM - Practice
Management.
Latest Updated Study Guide 2026/2027 with
Verified correct Answers.
don't market to ppl that don't fit your firm's goals/experience/values or you will be bringing
your firm more risk
-example: if you are a midsize firm in the US w no foreign experience, don't market to an
overseas developer
liability for professional corporation vs LLC/LLP. If you want to minimize risk, what
structure would you use? - ansprofessional corp liability is limited to the person who did the
malpractice/negligence
LLC/LLP limits liability to the amount of your investment in the company. no personal
liability.
*use LLC/LLP to minimize risk b/c your risk is limited to your investment. in professional
corporation, your risk isn't limited if you're the one who was negligent
when would you use a studio organization that has specialist departments? - ansin a very
large firm - when you can have separate departments for design, construction docs, and CA
(what's the difference bt this and horizontal then?)
squatter's session - ansintense, multi-day group meeting with the architects, client, and users
of the building being programmed and designed
C401 says what re: coordination of work? - ansconsultant must coordinate their services with
the arch and other consultants (NOT the architect's responsibility)
why would you hire an outside spec writer for a midsize general firm doing multiple project
types instead of using a subscription service for specs? - ans-third party spec writer can
customize the firm's specs to each project
-cost of the spec writer's fees can be passed on to the client with markup for coordination
-firm would not have to pay taxes and benefits bc the spec writer is an outside consultant, not
an employee
who would you consult first for vertical transportation solutions in a midrise city courthouse
project? - anselevator consultant - they are the common denominator b/t the facility manager,
security consultant, and elec engineer
(ARE doesn't expect you to know security concerns of a courthouse)
if the budget is very unrealistic and unfeasible, what AIA code of ethics is violated if you
accept the project? - ansnone - but you're screwing yourself over
