ENGV 380 Quiz 4 – Costs and Engineering | Questions &
Answers | Liberty University | 2026 Updated
1. Which of the following is normally considered a direct construction cost?
A. Corporate office rent
B. Concrete incorporated into a building foundation
C. Corporate accounting expenses
D. General advertising expenses
Answer: B. Concrete incorporated into a building foundation
Explanation: A direct cost can be specifically traced to the construction work
being performed. Concrete placed in a particular foundation can therefore be
directly assigned to that project activity.
2. A project has labor costs of $45,000 and material costs of $75,000. What is
the combined direct cost?
A. $110,000
B. $115,000
C. $120,000
D. $125,000
Answer: C. $120,000
Working:
Labor = $45,000
Materials = $75,000
Total direct cost:
$45,000 + $75,000 = $120,000
3. Which statement best describes an indirect construction cost?
,A. A cost that can always be assigned to one physical unit of work
B. A cost that supports construction but cannot easily be traced to one specific
work item
C. A cost that is always classified as profit
D. A cost that occurs only after project completion
Answer: B. A cost that supports construction but cannot easily be traced to one
specific work item
Explanation: Indirect costs support project execution but are not as directly
attributable to an individual construction quantity as direct costs.
4. Which expense is most likely to be classified as general company overhead?
A. Bricks installed on Project A
B. Concrete used on Project B
C. Corporate headquarters administration
D. Fuel consumed by a project excavator
Answer: C. Corporate headquarters administration
Explanation: General corporate administration supports the entire business
rather than one specific construction operation.
5. A project has direct costs of $350,000 and indirect project costs of $50,000.
What is the total cost before profit?
A. $300,000
B. $350,000
C. $400,000
D. $450,000
Answer: C. $400,000
Working:
$350,000 + $50,000 = $400,000
, 6. Which cost category generally includes wages paid to workers directly
installing project components?
A. Direct labor
B. General overhead
C. Financing cost
D. Corporate administration
Answer: A. Direct labor
Explanation: Workers performing measurable construction activities contribute
directly to project production.
7. Why is accurate cost classification important to a construction contractor?
A. It eliminates the need for estimating
B. It helps determine project cost and supports pricing and control decisions
C. It guarantees a project will make a profit
D. It eliminates construction risks
Answer: B. It helps determine project cost and supports pricing and control
decisions
Explanation: Correct classification allows management to develop reliable
estimates, monitor performance, and make informed pricing decisions.
8. Which of the following would most likely be a project-specific indirect cost?
A. Corporate CEO salary
B. Temporary field office for one project
C. Corporate marketing campaign
D. Company-wide accounting software
Answer: B. Temporary field office for one project
Answers | Liberty University | 2026 Updated
1. Which of the following is normally considered a direct construction cost?
A. Corporate office rent
B. Concrete incorporated into a building foundation
C. Corporate accounting expenses
D. General advertising expenses
Answer: B. Concrete incorporated into a building foundation
Explanation: A direct cost can be specifically traced to the construction work
being performed. Concrete placed in a particular foundation can therefore be
directly assigned to that project activity.
2. A project has labor costs of $45,000 and material costs of $75,000. What is
the combined direct cost?
A. $110,000
B. $115,000
C. $120,000
D. $125,000
Answer: C. $120,000
Working:
Labor = $45,000
Materials = $75,000
Total direct cost:
$45,000 + $75,000 = $120,000
3. Which statement best describes an indirect construction cost?
,A. A cost that can always be assigned to one physical unit of work
B. A cost that supports construction but cannot easily be traced to one specific
work item
C. A cost that is always classified as profit
D. A cost that occurs only after project completion
Answer: B. A cost that supports construction but cannot easily be traced to one
specific work item
Explanation: Indirect costs support project execution but are not as directly
attributable to an individual construction quantity as direct costs.
4. Which expense is most likely to be classified as general company overhead?
A. Bricks installed on Project A
B. Concrete used on Project B
C. Corporate headquarters administration
D. Fuel consumed by a project excavator
Answer: C. Corporate headquarters administration
Explanation: General corporate administration supports the entire business
rather than one specific construction operation.
5. A project has direct costs of $350,000 and indirect project costs of $50,000.
What is the total cost before profit?
A. $300,000
B. $350,000
C. $400,000
D. $450,000
Answer: C. $400,000
Working:
$350,000 + $50,000 = $400,000
, 6. Which cost category generally includes wages paid to workers directly
installing project components?
A. Direct labor
B. General overhead
C. Financing cost
D. Corporate administration
Answer: A. Direct labor
Explanation: Workers performing measurable construction activities contribute
directly to project production.
7. Why is accurate cost classification important to a construction contractor?
A. It eliminates the need for estimating
B. It helps determine project cost and supports pricing and control decisions
C. It guarantees a project will make a profit
D. It eliminates construction risks
Answer: B. It helps determine project cost and supports pricing and control
decisions
Explanation: Correct classification allows management to develop reliable
estimates, monitor performance, and make informed pricing decisions.
8. Which of the following would most likely be a project-specific indirect cost?
A. Corporate CEO salary
B. Temporary field office for one project
C. Corporate marketing campaign
D. Company-wide accounting software
Answer: B. Temporary field office for one project
