Estimating Practice Exam

What is required for a unit-price bid compared to a lump-sum bid?

1. More detailed documentation

2. A simpler approach

3. Less thorough itemization

4. Less accuracy in measurements

The correct answer is: More detailed documentation

A unit-price bid requires more detailed documentation because it involves breaking down the project into various components and determining a price for each unit of work. This detailed assessment is necessary to provide a clearer picture of costs for the contractor and the client, as it allows for the variation in quantities that may arise during the course of the project. In a unit-price scenario, the contractor must furnish itemized quantities, labor costs, materials, and overhead for each unit of work, which leads to better tracking of expenses and makes it easier to manage changes that may occur. This level of detail helps ensure that all parties have a clear understanding of what is being billed, facilitating transparency and accountability. In contrast, a lump-sum bid encompasses a total price for the entire project, which does not require extensive documentation of individual units. This can result in less detailed proposals and a lack of itemization, leading to uncertainty if changes or disputes arise. Therefore, the requirement for more thorough and detailed documentation in unit-price bids is essential for accurate project management and financial control.