A contractor has hired a subcontractor to construct a parking lot for 60 cars. The parking lot will be 60 feet x 270 feet. The subcontractor has…

The total cost is determined by first calculating the area of the parking lot in the correct units, applying the subcontractor's unit price, and then adding the contractor's mark-up.

1. Area Calculation: 60 feet × 270 feet = 16,200 square feet.

2. Unit Conversion: Since the price is per square yard, convert the area: 16,200 sq ft / 9 sq ft per sq yd = 1,800 square yards.

3. Subcontractor Cost: 1,800 sq yd × $13.25/sq yd = $23,850.

4. Contractor's Total Price (with mark-up): $23,850 × 1.15 = $27,427.50.

5. Cost per Space: $27,427.50 / 60 spaces = $457.13.

This value rounds to $457.

A. $398: This is the cost per space before the contractor's 15% mark-up is applied ($23,850 / 60 spaces = $397.50).

C. $3,578: This figure represents the contractor's total 15% mark-up amount ($23,850 × 0.15 = $3,577.50), not the cost per individual space.

D. $4,115: This is the result of a significant calculation error and does not correspond to any logical step in the estimating process.

1. The American Institute of Architects. (2013). The Architect's Handbook of Professional Practice (15th ed.). Wiley. Chapter 9.4, "Cost Management from Design through Construction," discusses how a contractor's total price is composed of direct costs (e.g., subcontractor quotes), general conditions, overhead, and profit. The 15% mark-up represents these additional costs and profit.

2. Peurifoy, R. L., & Oberlender, G. D. (2013). Estimating Construction Costs (6th ed.). McGraw-Hill Education. Chapter 1, "Introduction to Estimating," details the standard estimating process which includes quantity takeoff (calculating the 1,800 sq yd), applying unit pricing, and adding markups to determine the final project cost.

3. MIT OpenCourseWare. (2009). 1.452J / ESD.052J Introduction to the Business of Engineering and Construction. Lecture notes on "Cost Estimating" outline the methodology of building a bid price by calculating direct costs based on quantities and unit prices, then applying percentages for indirect costs (overhead) and profit (mark-up).