Residential Builder's Salesperson Practice Exam

A comprehensive project estimate must take into account both company overhead and project overhead. Company overhead refers to the general costs incurred by the business that are not directly tied to any particular project, such as administrative salaries, utilities, and office supplies. These costs are critical to ensure that the business can operate effectively and meet its obligations.

Project overhead, on the other hand, refers to costs that are specifically associated with a particular project, such as tools, equipment, insurance, and temporary facilities. These costs are necessary to manage and execute the project successfully and must be included in the estimate to ensure that the project is financially viable.

By including both types of overhead in the estimate, a builder can ensure that they are accounting for all aspects of the project's financial requirements, leading to more accurate budgeting and a better chance of completing the project within its financial parameters. This thorough accounting helps to avoid financial shortfalls and promotes transparency in the project's expected costs.