Enough To Estimating and Valuation PDF

NISSAN FOUNDATIONS
Notes by:
Er. Shambhu Kumar Shah
enough to
Estimating
and Valuation
By: nissan
2013
Introduction, Methods of Estimating, Preparation of Detailed Estimate, Types of Estimates

Analysis of Rates, Detailed Estimate, Valuation, Specification.
enough to Estimating and Valuation 3
[1] INTRODUCTION
An estimate is a computation or calculation of the quantities required and expenditure

likely to be incurred in the construction of a work. The primary objective of the estimate is to
enable one to know beforehand, the cost of work. The actual cost should not differ much from
the estimated cost.
To make out an estimate for a work the necessary things are: (i) Drawings (plans, sections, etc.),
(ii) Specifications, and (iii) Rates
i) Drawings
Plans, sectional elevation and detailed drawings to scale, fully dimensioned are required.
The plan, elevation and sections are usually drawn to a scale 1cm = 1m and detailed drawings
are prepared to a scale of 1cm = 10cm.
ii) Specifications
The specifications can be divided into two categories:
a) General specifications or Brief specification
This gives the nature, quality, class and work of materials. It gives an idea of
whole building or structure and is useful in preparing the detailed estimate.
b) Detailed specification
This gives the detailed description of the various items of work; the quantities &
qualities of materials, their proportion, the method of preparation, workmanship and
execution of the work. These are helpful for the execution of the different items of work.
iii) Rates
The rates per units of various items of works including various materials to be used,
labour (skilled & unskilled) are calculated by using standard norms and approved schedule of
rates called ‘Rate Analysis’.
Units of Measurements and Payments for Various Items of Works
Units of
S.N. Particulars of Item Measurement
& Payment per
01. Earthwork in excavation in different soil cu. m.
02. Earth filling in excavation in foundation cu. m.
03. Surface dressing and levelling, cleaning sq. m.
04. Sand filling cu. m.
05. PCC/RCC work cu. m.
06. PCC work (thickness specified) sq. m.
07. DPC –cement concrete (thickness specified), Asphalt, Rich cement mortar cu. m.
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4 INTRODUCTION Notes by: Shambhu Kumar Shah
08. Brick work in foundation and plinth cu. m.

09. Honeycomb brick work: thickness specified sq. m.
thickness not specified cu. m.
10. Half brick partition wall sq. m.
11. Stone masonry work cu. m.
12. Wood work for door/windows, chaukhat, rafter, beam, roof trusses, etc. cu. m.
13. Door/ windows panelled or glazed shutter sq. m.
14. Wood work in partition, ceiling, flooring, etc. sq. m.
15. Steel reinforcement in RCC work quintal
16. Iron gate sq. m./ quintal
17. Iron railing (height and types specified) m.
18. Iron grill, collapsible gate sq. m./ quintal
19. Rolling shutter sq. m.
20. Steel door and windows (types and fixing specified) m.
21. Barbed wire fencing sq. m.
22. CGI sheet roofing / AC sheet roofing sq. m.
23. Slate roofing, Timber roofing sq. m.
24. Eaves board (thickness specified) sq. m.
25. Centring and shuttering, form work sq. m.
26. Cement plaster (thickness, proportion specified) sq. m.
27. Cement pointing – struck, flush sq. m.
28. Dado (thickness and type specified) sq. m.
29. Skirting (thickness, type and height specified) m.
30. White washing, snow cement painting (number of coat specified) sq. m.
31. Enamel painting, aluminium painting on grill (no. of coats specified) sq. m.
32. Mosaic or terrazzo or granolithic floor over 7.5 cm (3”) Lime concrete sq. m.
33. Brick soling (flat) sq. m.
34. Brick soling on edge sq. m.
35. Railing work (height and type specified) m.
36. Pipe – rain water, sanitary, water pipe, etc. (diameter specified) m.
37. Laying of pipe line – sanitary, water pipe, etc. (dia., depth, bedding, specif m
38. Glazing work sq. m.
39. Electrical wiring of light, fan, etc. point
40. Supply of WC, wash basin, bib cock, etc. no.
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Main Items of Works and their Methods of Measurements
1. Earthwork
 Earthwork shall be taken in cubic meter (cu. m.) and the length, breadth and height or depth
shall be measured to get the cubic content.
 E/W of different nature as in excavation in foundation, in trenches etc. in filling in plinth, in
banking etc. shall be measured under separate item.
 E/w in different kinds of soil as ordinary soil, hard soil, ordinary rock, hard rock, etc. shall be
classified separately and measured under separate items.
 The measurement shall be taken separately for every 30m lead and every 1.5m lift or height or
depth.
2. Concrete work
 Concrete shall be taken in cubic meter and measurements of length, breath and height or
thickness shall be taken to the nearest 1 cm.
 The kind of concrete, size, grading and proportion of materials, method of mixing, cutting, etc.
shall be described.
 Different kinds of concrete work as lime concrete, cement concrete, RCC, etc. of different
proportions, different materials shall be taken under separate items.
3. Centring & Shuttering of RCC work

 Form work (centring or shuttering) shall be taken in square meter (sq. m.).
 Form work shall be measured as the actual surface in contact with the RCC work.
 For slabs, vertical sides (edges) shall not be measured.
 Form work of different kinds of work as beam, lintel, floor, road wall, column, etc. shall be
measured under separate items and fully described.
4. Brickwork
 Brick work shall be taken in cubic meter and measurements of length, breath or thickness and
height shall be taken to compute the quantity.
 The description of bricks and of the materials of mortar with proportion shall be stated.
 Different kinds and classes of b/w shall be taken under separate items.
 Scaffolding works are not measured separately but included in the item of brick-work.
 No deduction or addition shall be made for opening up to 0.1 sq. m. in section.
5. Honey comb brickwork

 Honeycomb brickwork shall be taken in square meter stating the thickness of well and the
pattern of honey combing.
 Honeycomb holes or opening shall not be deducted.
 If thickness of honeycomb wall is not specified it can also be measured in cubic meter.

6. Partition wall
 Half brick wall or bricks-on-edge shall be taken in square meter stating thickness and shall be
fully described including mortar and its proportion.
 Reinforcement as hoop mask, wire netting or bars if provided shall be included in the items and
fully described stating type, width, gauge or thickness of diameter and spacing.
7. Door and Window shutters

 Doors and windows shutters shall be taken in square meter stating the thickness and kind of
wood and both faces shall be described.
 The type of shutter i.e. flush, glazed, panelled, etc. shall be taken separately & each type fully
described.
 For glazed shutter, it shall be measured flat over all in sq. m. including timber frame work stating
the thickness of timber and of glass panes. Glazing shall not be measured separately.
8. Steel reinforcement
 Bar reinforcement shall be measured by weight in quintal stating the diameter and shall include
cutting to length, hooked ends, cranking or bending, etc.
 Authorised overlaps shall be measured and different diameter bars shall be kept separately.
 Binding wire shall not be measured separately; this shall be included in the item.
9. Cement plastering
 Plastering shall be taken in square meter stating thickness, mortar and its mix.
 Plastering of all roofs, ceiling, walls, etc. shall be measured under separate items.
 The measurement of all plastering shall be taken for the dimension before plastering for length
and from top to floor or skirting to ceiling for height.
 Exterior plastering to a height greater than 10m from average GL shall be measured separately
in stages of 3m.
 When the two faces are plastered with different mortars of if one side plastered and other side
pointed, then deduction shall be made for the outer face only.
10. Cement Pointing

 Pointing shall be taken in sq. m. and measured flat of the whole outer-face area stating the type
of mortar and its mix.
 Various types of pointing as flush, struck, etc. shall be taken separately.
 Pointing of wall, floor, roof, etc. shall be kept separately.
 Raking of joints shall be included in the item.
11. Cement Painting

 Cement painting shall be taken in square meter stating number of coats.
 Preparatory work as cleaning, rubbing down, removing, etc. shall be described.
 The item shall include repairs of surfaces as holes, cracks, patches, etc. not exceeding 0.1 m2
with materials similar to existing surface.
 The deduction shall be made as same as plaster work i.e. for two faces painting, only one
external opening shall be deducted.
12. Water supply & Sanitary work

 All pipes and fittings should be classified according to their types, diameters, jointing and fixing.
 Pipes shall be measured in running meter stating size, class, pressure, etc.
 Laying or fixing with overall fittings such as bends, junctions, etc. are included in the items of
work, so not measured separately.
 Method of laying and jointing shall be fully described.
 Digging and refilling of trenches, concrete bedding, etc. shall be measured separately.
 Manholes up to 6 m. (20 ft.) depth shall be enumerated stating the size and depth and shall
include cast iron cover with frame (weight stated) materials and mortar, formwork, etc. all of
which shall be fully described.
 Sanitary appliances i.e. water basin, water closet, sink, towel rod, soap case, etc. shall be taken
in numbers and measured separately and fully described.
13. Electrical work

 Electrical wiring shall be taken in points as light points, fan points, power socket points, etc. and
shall be enumerated under different items and fully described.
 Point wiring includes switch, ceiling rose, switch boards, battens, nails, wire, etc. in the item.
 Earthing and service connection shall be enumerated and fully described as including earth
electrode, packing charcoal, earth wire, etc.
 The number of fans, light bulbs, wall bracket, …me light, etc. are enumerated clearly and fully
described as brands, standards, size, watt, etc.
14. Dismantling & Demolition

 The term dismantling implies carefully taking up or down & removing carefully without damage.
 The term demolition – taking up or down or braking up without care.
 The units and method of measurement of dismantling and demolition shall be generally the
same as those employed for the construction of the respective item of work. For e.g.:
RCC work 
Brickwork  m3
 Thickness of plaster shall be excluded in the measurement of wall.
 Dismantling of doors and windows shall be enumerated stating their size.

Method of Building Estimate or Methods of Taking Quantities
Method I : Long wall & Short wall Method

In this method; the external lengths of walls running in the longitudinal direction
generally long walls out-to-out and the internal lengths of walls running in the transverse
direction in-to-in are measured; and quantity is calculated by multiplying the length by the
breath and the height of the wall.
Here,
Longer wall = 2 × 5.1 = 10.2 m
Shorter wall = 2 × 3.9 = 7.8 m
Total length (L) = 10.2 + 7.8 = 18 m
Since, Quantity = length (L) × breadth (B) × height (H)
Quantity = 18 × 0.1 × 4 = 7.2 cu. m.

taking Height (H) = 4 m
Method II : Centreline Method

In this method; total length of centre lines of walls (long & short) has to be found out.
The total length of centre lines of walls, of same type, long and short having same type of
foundations and footings is found and then the quantities are obtained by multiplying the total
central length by the respective width and the height.
Total centre length of wall

= (2 × c/c of longer wall) + (2 × c/c of shorter wall)
= (2 × 5) + (2 × 4) = 10 + 8 = 18 m.
Since, Quantity = length (L) × Breadth (B) × Height (H)
Here, L = 18 m
B = 0.1 m
H = 4 m (assume)
Quantity = 18 × 0.1 × 4 = 7.2 cu. m.
For Two Roomed building:
Here,
Total centre length of wall = (2 × c/c of longer wall) + (3 × c/c of shorter wall)
= (2 × 9) + (3 × 4) = 18 + 12 = 30 m.
But, Quantity = length (L) × Breadth (B) × Height (H)
Here, L = total centre length – number of overlaps × ½ breadth = 30 – 2 × ½ × 0.1 = 29.9 m

B = 0.1 m
H = 4 m (assume)
Quantity = 29.9 × 0.1 × 4 = 11.96 cu. m.
Method III : Crossing Method

In this method, the overall perimeter of building is found out and the value equal to four
times the thickness of wall is subtracted from it, to obtain the centre line length. This method is
rarely used.

10 TYPES OF ESTIMATE Notes by: Shambhu Kumar Shah
[2] TYPES OF ESTIMATE
Types of Estimate
1) Preliminary Estimate or Approximate or Abstract or rough Estimate
2) Plinth Area Estimate
3) Cube Rate Estimate or Cubical Content Estimate
4) Detailed Estimate or Item Rate Estimate
5) Revised Estimate
6) Supplementary Estimate
7) Annual Repair or Maintenance Estimate (A.R. or A.M. Estimate)
1) Preliminary Estimate
Preliminary estimate is required for preliminary studies of various aspects of a project;
to decide the financial position and policy for administrative sanction by the competent
administrative authority.
 In case of commercial projects as irrigation project, building project; the probable cost of the
project is estimated by this method to know whether the investment on the project is justified
or not.
 In includes the approximate estimates of various works separately such as cost of land, cost of
each building, cost of roads, w/s and sanitary works, electrification etc.
2) Plinth Area Estimate

This is prepared on the basis of plinth area of the building.
 It is calculated by finding the plinth area of the building and multiplying by the plinth area rate.
 The area should be calculated for the covered area by taking external dimension of the building
at floor level. Courtyard or other open area shouldn’t be included in the plinth area.
 It is only an approximate method.
 For multi-storeyed building, the plinth area estimate is prepared for each storey separately.
3) Cube Rate Estimate

It is a preliminary or an approximate estimate prepared on the basis of the cubical
content of the building.
 It is calculated by finding the cubical content of the building (length × breadth × height) and
multiplied by the cube rate.
 It is most accurate as compared to the Plinth area estimate as the height of the building is also
compare.
4) Detailed Estimate
It is an accurate estimate and consists of working out the quantities of each item of work
and working the cost.
 The dimensions; length, breadth and height of each item are taken out correctly from drawing
and each item are calculated, and obstructing and billing is done.
 It is prepared in two stages:
i) Details of measurement and calculation of quantities:
ii) Abstract of estimated cost
- The cost of each item of work is calculated in a tabular form from the quantities already
computed and total cost is worked out in Abstract of Estimate Form.
- 3 % of the estimated cost is allowed for contingencies.
- 2 % is provided for work-charged establishment.
- Detailed estimate is usually prepared work-wise, under each sub-work as main building,
servant quarters, garage, boundary walls etc.
 Detailed estimate is accompanied with:
i) Report ii) General Specification iii) Detailed Specification
iv) Drawings: Plans, Elevations, Sections, Site Plan etc. v) Calculations & Designs
vi) Analysis of Rates as per approved Schedule of rates
 Detailed estimate is prepared for technical sanction of the competent authority, for arranging
contract and for the execution works.
5) Revised Estimate
The revised estimate should be accompanied by a comparative statement showing the
variations of each item of works, its quantity, rate and cost under original.
 Revised estimate is detailed estimate and is required to be prepared under any one of the
following circumstances:
i) When the original sanctioned estimate is exceeded or likely to exceed by more than 5 %.
ii) When the expenditure on a work exceeds or likely to exceed the amount of
administrative sanction by more than 10 %.
iii) When there are material deviations from the original proposal, even though the cost
may be may be met from the sanctioned amount.
6) Supplementary Estimate
It is a detailed estimate and is prepared when additional works are required to
supplement the original works, or when further development is required during the progress of
work. This is a fresh detailed estimate of the additional works in addition to the original
estimate.
7) Annual Repair or Maintenance Estimate

It is a detailed estimate and is prepared to maintain the structure or work in proper
order and safe condition.
 For building; this includes white washing, colour washing, painting, minor repairs etc.
 For road works the A.R. Estimate provides for patch repairing, renewals, repairs of bridges and
culverts etc.

Various TERMS
 Contingencies
The term ‘contingencies’ indicates incidental expenses of miscellaneous character which
cannot be classified under any distinct item sub-head, yet pertain to the work as a whole.
 In an estimate a certain amount in the form of contingencies of 3% to 5% of estimated cost, is
provided to allow for the expenses for miscellaneous petty items which do not fall under any
sub-head or items of work.
 The contingency may be expend for the project management cost, i.e. fuel, papers, allowance
for related technician for supervision, vehicles etc.
 If there is any saving against the amount provided under contingencies, this amount may be
utilised with the sanction of the competent authority, to meet the expenses of extra items of
work, if any unforeseen expenditure, expenses to minor changes in design etc.
 Work-charged Establishment
Work-charged establishment is the establishment which is charged to work directly.
 During the construction of a project, for a certain number of works; supervisors, watchman,
munshi, etc. are required to be employed, and their salaries are paid from the amount of work-
charged establishment provided in the estimate.
 For work-charged establishment a percentage of 1.5% to 2% of the estimated cost is included in
the estimate.
 The work-charged employees are temporary staff and their appointment services are terminated
at the expiry of the sanctioned period.
 Departmental or Centage Charges / Supervision charges

When the engineering department takes up the work of other department a percentage
amount of 10 % to 15 % of the estimated cost is charged to meet the expenses of establishment,
designing, planning, supervision etc. and this percentage in known as centage charge.
 Centage charge is also made on contributory and deposit works of local bodies, private persons
and others.
 Centage charge is provided in the estimate of the work and is also known as supervision charges
of works.
 Administrative Approval or Sanction

For any project or work required by a department, an approval or sanction of the
competent authority of the department, with respect to the cost and work is necessary at the
first instance.
 The approval authorises the engineering department to take up the work.
 It denotes the formal acceptance by the department, concerned for the proposal.
 After administrative approval is given the engineering department (p.w.d.) take up the work and
prepares detailed designs, plans and estimates and then executes the work.
 The engineering department prepares approximate estimate and preliminary plans and submits
to the department concerned for administrative approval.
 Expenditure Sanction
Expenditure sanction means allotment of fund for a specific work and usually accorded
by the finance department.
 No expenditure can be incurred before expenditure sanction is given.
 Technical Sanction
Technical Sanction means the sanction of detailed estimate, design calculations,
quantities of works, rates and cost of the work by the competent authority of the engineering
department.
 After the technical sanction of the estimate is given, then only the work is taken up for
construction.
 In case of original work the counter signature of the local head of the department should be
obtained in the plan and estimate before technical sanction is accorded by the engineering
department.
Bill of Quantities
It is a statement of the various items of work giving the description, quantities and unit
of rates.
 It is prepared in a tabular form similar to the ‘Abstract of Estimated Cost’ of the detailed
estimate, but the rate and amount column are left blank (unfilled).
 It is primarily meant for inviting Tender and supplied to the Contractor to fill up the rates and
amounts column.
 On receipt of the tenders the rates and amounts are compared and decision about entrusting
the work is finalised.
Bill of Quantities (Typical Sheet)
Item
Particulars of Items Quantity Rate Unit per Amount Remark
no.
1. Earthwork in excavation 35 m3 …… per % m3 ………
2. Earthwork in filling 30 m3 …… per % m3 ………
3. Lime concrete in foundation 15 m3 …… per m3 ………
4. First class brick work in lime mortar in
foundation and plinth 35 m3 …… per m3 ………
5. Damp proof course 2.5 cm C.C. 1:1.5:3 12 m2 …… per m2 ………
6. Brick work 1:6 mortar in superstructure 35 m3 …… per m3 ………
7.
Split up of Cost of Building work

i. Excavation & concrete in foundation : 3%
ii. Earthwork up to plinth : 5%
iii. Earthwork up to superstructure : 25 %
iv. Roofing : 20 %
v. Flooring : 6%

vi. Wood works – D/W : 15 %

vii. Internal finishing : 6%
viii. External finishing : 3%
ix. Water supply works : 4%
x. Sanitary works : 8%
xi. Electrification : 5%
Total : 100 %
Terms used for Preparing Preliminary Estimation
i. Plinth Area
 It is the built up area of building measured at floor level of any storey.
 Courtyard, open areas, balconies, cantilever projection are not included.
 Plinth offsets are not included.
ii. Floor Area

 Floor area means plinth area minus wall area.
 It includes floor of all rooms, varandah, passing corridor, staircase room, kitchen, stores, etc.
iii. Circulation Area

 It is the floor area of verandah, passing corridors, balconies, entrance hall, porches, staircase
used for the movement of people.
 It may be divided into two parts:
a) Horizontal Circulation Area (verandah, corridor, porch, etc.): 10 – 15 % of plinth area
b) Vertical Circulation Area (staircase, lift, etc.): 4 – 5 % of plinth area
iv. Carpet Area

 It is the useful area or liveable area or settable area.
 This is the total floor area minus circulation area and minus other non-usable area as
bathroom & w. c., air conditioning room, etc.
 For office building : 60 – 70 % of plinth area
and for residential building : 50 – 65 % of plinth area, is considered as carpet area.
Complete Estimate of a Project

This should include all items of expenditure from the beginning up to the end.
The complete estimate includes the following:
(i) The cost of preliminary works as surveying observations and investigations and other
preliminary works.
(ii) Cost of land including its acquisition and legal expenses.
(iii) Cost of improvement of land by levelling, digging and filling if required.
(iv) Cost of planning, designing, preparation of estimate etc.
(v) Cost of building structure, including internal electrification, sanitary and water supply works.
(vi) Cost for supervision charges during execution of works.

(vii) Cost of temporary accommodation or staff, labour and other amenities (for big project only).
(viii) Cost of water supply and electric connection during construction.
(ix) Cost of external services as roads, electric service lines, storm water drains, external water
supply and sanitary works etc.
(x) Cost of maintenance and repair works and other running expenditures during the construction
(if the construction runs for a number of years).
(xi) For building designed and supervised during construction by an architect, the fees of architect.
Solved Problem
 Prepare a preliminary estimate of a building with the following data.

Given,
Carpet area = 9000 m2
Circulation area = 20 % of built up area
Area covered by brick wall = 15 % of built up area
Plinth area rate = NRs. 12000 per sq. m.
Cost of w/s and sanitation = 8% of building cost
Cost of electrification = 8% of building cost
Cost for architectural treatment = 1.5% of building cost
Contingencies and supervision charges = 7.5 % of total cost
n
Sol .
Since, Plinth area or Built up area = Carpet area + Circulation area + Area occupied by wall
Let, be the built up area or plinth area
= carpet area + 20% of built up area + 15% of built up area
or, = 9000 + 0.2 × + 0.15 ×
= 13846.15 m2
Now,
i) Building cost = 13846.15 @ 12000 per sq. m. = 16,61,53,800
ii) W/s and Sanitary installation = 8% of building cost = 1,32,92,304
iii) Electrification cost = 8% of building cost = 1,32, 92,304
iv) Architectural treatment cost = 1.5% of building cost = 24,92,307
Total Cost = 19,52,30,715
Contingencies and supervision charge = 7.5% of total cost = 1,46,42,303.63
Grand total Cost of the building = NRs. 20,98,73,018.63 .

16 RATE ANALYSIS Notes by: Shambhu Kumar Shah
[3] RATE ANALYSIS
The determination of rate per unit of a particular item of work, from the cost of
quantities of materials, the cost of labourers and other expenses; required for its completion is
known as the Rate Analysis. The rate of material and labour may vary from place to place and
the rates of different items of works also vary from place to place.
Purposes
a) To workout the actual cost of unit rate of an item of work.
b) To workout the economical use of materials and process in completing the particular item.
c) To workout the cost of extra items which are not provided in contract bond, but are to be
done as per the direction of the department.
d) To revise the schedule of rates due to increase in the cost of materials and labours or due
to change in technique.
Factors affecting Rates

i) Specification of works and materials, quality of materials, proportion of mortar, method of
constructional operation, etc.
ii) Qualities of materials & their rates, number of different types of labourers and their rates.
iii) Location of the site of work and its distance from the sources of materials and the rate of
transport, availability of water.
iv) Profits and miscellaneous and overhead expenses of contractor.
Overhead Costs
Overhead costs include general office expenses, rents, taxes, supervision and other costs
which are indirect expenses and so called not productive expenses on the job.
 The contractor may be allowed to add an overhead cost of 15% of the construction cost.
The miscellaneous expenses on overheads may be under the following heads:-

A. General Overheads
i) Establishment (office staff) ii) Stationary, printing, postages, etc.
iii) Travelling expenses iv) Telephone v) Rent and taxes
B. Job Overheads
a) Supervision (salary of Engineers) e) Workmen’s compensation,
b) Handling of materials, tools, plants, insurance, etc.
c) Repairs, carriage and depreciation of T. & P. f) Interest on investment
d) Amenities of labour g) Losses on advances
Task or Out-turn Work

The capacity of doing work by an artisan or skilled labour in the form of quantity of work
per day is known as the task-work or out-turn of the labour.
The out-turn of work per artisan varies to some extent according to the nature, size,
height, situation, location, etc. In bigger cities where specialised and experienced labour is
available the out-turn is greater than in small towns and country sides. In well organised work,
less labour is required.
1. Rate Analysis for PCC (1:2:4) for 1 m3.

Solution:
Wet volume of concrete = 1 m3
Dry volume of concrete = 1  1.52 ( 50 – 55 % of wet vol.)
Total parts of mix proportion =1+2+4
=7
Quantity of cement =
= 0.217 m3
= 0.217  30 bags ( 1m3 = 30 bags)
= 6.5 bags
Quantity of sand = 0.217  2 = 0.434 m3
Quantity of aggregate = 0.217  4 = 0.868 m3
Water = 0.5  6.5  50 = 162.5 litres [ w/c ratio = 0.5]
Particulars Unit Quantity Rate Amount

Materials
Cement Bags 6.5 650 4225
Sand m3 0.434 1400 607.6
Aggregate m3 0.868 1800 1562.4
Water Litres 162.5 0.2 32.5
Labours
Skilled nos. 1 400 400
Unskilled nos. 4 250 1000
tools/plants 3% of labour cost 42
Total 7869.5
Add 10 % contractor's overhead 786.95
Total Rate = 8656.45 (per m3)
2. PCC (1:1.5:3) for 10 m3.

Solution;
Wet volume of concrete = 10 m3
Dry volume of concrete = 10  1.52 = 15.2 m3
Total mix proportion = 1 + 1.5 + 3 = 5.5
Quantity of Cement = = 2.764 m3
= 2.764  30 bags = 82.9 bags
Quantity of Sand = 1.5  2.764 = 4.146 m3

Quantity of Aggregate = 3  2.764 = 8.292 m3

Water = 0.5  82.9  50 = 2072.5 litres
[For 10 m3]
Materials
Cement Bags 82.9 650 53885
Sand m3 4.146 1400 5804.4
Aggregate m3 8.292 1800 14925.6
Water Litres 2072.5 0.2 414.5
Labours
Skilled nos. 8 400 3200
tools/plants 3% of labour cost 148.5
Sub-total 80128
Total Rate = 88140.8
Rate per m3 = 8814.08
3. Rate analysis for 75 mm thick PCC (1:2:4) for 180 m2.

Solution:
Wet volume = 180  = 13.5 m3
Dry volume = 13.5  1.52 = 20.52 m3
Mix proportion =1+2+4 =7
= 2.931  30 bags = 87.9 bags
Quantity of Sand = 2.931  2 = 5.862 m3
Quantity of Aggregate = 2.931  4 = 11.724 m3
Water = 0.5  87.9  50 = 2197.5 litres

Materials: Cement bags 87.9 650 57135
Sand m3 5.862 1400 8206.8
Aggregate m3 11.724 1800 21103.2
Water litres 2197.5 0.2 439.5
Labours : Skilled nos. 22.5 400 9000
Total 110059.5
Rate per square meter = 703.16
4. Steel Reinforcement of RCC work : Unit = 1 MT (1000 kg).

Solution; Quantity of steel = 1 MT
Add 5% for wastage = 1.05 MT
Materials: Steel MT 1.05 75000 78750
Binding Wire Kg 10 80 800
Labour: Skilled nos. 12 400 4800
T&P 3% of labour cost 234
Sub- total 87584
Add 15% for contractor's overhead 13137.6
Total Rate per MT 100721.6
5. Formwork for beam and slab ; Unit = 10 m2.

3
Materials: Wood (normal) m 0.07 18000 1260
Nails kg 2.5 100 250
Labours: Skilled nos. 1.72 400 688
Unskilled nos. 2.57 250 642.5
Sub-total 2880.415
Rate per cubic meter = 331.25
6. Brick work (1:4 cement mortar) in super structure for 1 m3.

Solution;
Brick size = 230 mm  110 mm  55 mm
Thickness of mortar = 10 mm
Brick size with mortar = 240  120  65
Number of bricks = = 534 nos.

Add wastage (5%) = 5 % of 534 = 26 nos.
Total bricks = 560 nos.
Volume of mortar in 1 m3 brickwork = 1 – 534 (0.23  0.11  0.055) = 0.2569 m3.

Dry volume of mortar = 0.2569  1.3 ( 30% of wet vol.)
= 0.34 m3
Mix proportion = 1 + 4 = 5
= 0.068  30 bags = 2.04 bags
Quantity of Sand = 0.068  4 = 0.272 m3
Water = 0.5  2.04  50 = 51 litres


Materials: Brick nos. 560 10 5600
Cement bags 2.04 650 1326
Sand m3 0.272 1400 380.8
Water litres 51 0.2 10.2
Labours: Skilled nos. 1.5 400 600
Unskilled nos. 2.2 250 550
(scaffolding) Unskilled nos. 0.7 250 175
Total 8681.75
3
Total Rate/m = 9984.013
7. Half brick wall (110 mm thick) for partition with 1:4 cement mortar. [100 m2]
Solution;
Quantity of brick wall = 100  = 11 m3.
Brick size = 230 mm  110 mm  55 mm
Mortar thickness = 10 mm
Brick size with mortar = 240  120  65
Number of brick = = 5876
Wastage (5%) = 294 nos.
Total = 6170 ओटा
Volume of mortar in 11 m3 brickwork = 11– 5876(0.23  0.11  0.055) = 2.82 m3.

Dry volume of mortar = 2.82  1.3 = 3.66 m3.
Cement = = 0.733 m3 = 22 bags
Sand = 0.733 m3 = 2.93 m3.
Water = 0.5  22  50 = 550 litres

Materials: Brick nos. 6170 10 61700
Cement bags 22 650 14300
3
Sand m 2.932 1400 4104.8
Water litres 550 0.2 110
Labours: Skilled nos. 35 400 14000
(scaffolding) Unskilled nos. 16.1 250 4025
Total 111913.1
Total Rate(for 100 m2) = 128700
2
rate / m 1287
8. Cement plaster (1:4) 12 mm thick, on wall (unit : 100 m2).

Solution;
Wet mix of mortar = 100  = 1.2 m3
Add 30% to fill up joints, uneven surface = 1.2  1.3 = 1.56 m3
Add 25% for Dry volume = 1.56  1.25 = 1.95 2m3
Mix =1+4 =5
Quantity of Cement = = 0.4 m3 = 12 bags
Sand = 0.4  4 = 1.6 m3
Water = 0.5  12  50 = 300 litres

Materials: Cement bags 12 650 7800
3
Sand m 1.6 1400 2240
Water litres 300 0.2 60
Labours : Skilled nos. 12 400 4800
Total 19164
2
Total Rate(for 100 m ) = 22038.6
2
rate / m 220.386
9. Water Closet fixing

Prepare a Rate analysis for supplying and fixing Water closet (WC) commode with low level
flushing cistern per number.
Particulars Quantity Unit Rate Amount
Materials:
1. (EPNC) water closet 1 no. 3000 3000
2. Low level flushing cistern of 10 litres capacity 1 no. 3500 3500
3. Bakelite heavy duty commode cover plate with
1 no. 500 500
cp hinges
4. Angle valve 1 no. 1200 1200
5. 400 mm dia. flushing pipe 1 no. 300 300
6. Screw, nails, clamps etc. 1 no. 300 300
Labours:
Skilled 3 nos. 400 1200
Unskilled 3 nos. 250 750
Sub-total 10750
15% contractor's overhead 1612.5
Total rate / no. = 12362.5

Labour Breakdown
Scaffolding
S.N. Name of Work Unit Skilled Unskilled
(unskilled)
01. PCC (1:2:4) 1 m3 1 4
02. RCC (1:2:4) 1 m3 0.8 7
03. Steel reinforcement 1 MT 12 12
04. Form work 10 m2 1.72 2.57
05. 50 mm thick flooring with PCC (1:2:4) 10 m2 1.25 2.5
06. 75 mm thick flooring with PCC (1:2:4) 10 m2 1.25 3
07. Brickwork 1:4 cement mortar (foundation) 1 m3 1.5 2.2 0.2
08. B/W 1:4 c/m (superstructure) 1 m3 1.5 2.2 0.7
09. ½ brick-wall, 1:4 c/m 10 m2 3.5 5.1 1.6
10. Random rubble stone masonry work 1 m3 1 2.25
11. 12 mm thick 1:4 cement plaster on wall 100 m2 12 16
12. 12 mm thick 1:4 c/p on ceiling 100 m2 15 20
2
13. 20 mm 1:4 c/p on wall 100 m 14 19
2
14. Two coat snowcem paint 100 m 5 5
2
15. Two coat enamel paint 100 m 12 8
16.
 Calculate the transportation charge per bag of cement by a truck for a lead of
30km, capacity of truck 400 bags per trip (assume necessary data).
Solution:
Here, Lead (L) = 30 km
We have, Number of trips per day (i.e. 8 hrs.)
Assuming, Speed of truck (S) = 40 km/hr. Then, = 3.55
Also, Cost of truck per day = Rs. 12,000
Cost per trip = = Rs. 3380.28
So, Cost per bag = = Rs. 8.45 .
[4] DETAILED ESTIMATE
Road Earthwork Estimate

Cross-section of earthwork of road in banking or in cutting is usually in the form of
trapezium. Quantity or Volume = Sectional area × Length
1) Mid-sectional Area Method
Area of mid-section = area of rectangular portion + area of two triangular portion

=B +2×½S
Where, means mean depth =
=B +S
In general, Quantity (Q) = (Bd + S ) × L
Stations Depth Mean Area of Area of Total Length Quantity

or or depth or central sides sectional between (B d + S ) × L
Chain- Height Height portion (S ) area stations Filling Cutting
age (d) (Bd) (Bd+S ) (L)
2) Mean sectional Area Method

Quantity = mean sectional area × length
where, mean sectional are is given by;
( )
3) Prismoidal Formula Method

Quantity (Q) = ( )
Here, =B +S (one end)
=B +S (other end)
=B +S (mid) Where, =
* ( ) ( )+

24 DETAILED ESTIMATE Notes by: Shambhu Kumar Shah
 Estimate the cost of earthwork for a portion of road for 400 metre length from the following
data: Formation width of road is 10m. Side slopes are 2:1 in banking & 1.5:1 in cutting.
Station Distance in metre R.L. Of Ground R.L. of Formation i.e. (F.L.) F.L. – G.L.
25 1000 51 52.00 52 1
26 1040 50.9 . 51.8 0.9
27 1080 50.5 . 51.6 1.1
28 1120 50.8 . 51.4 0.6
29 1160 50.6 Downward 51.2 0.6
30 1200 50.7 gradient of 51 0.3
31 1240 51.2 1 in 200 50.8 -0.4
32 1280 51.4 . 50.6 -0.8
33 1320 51.3 . 50.4 -0.9
34 1360 51 . 50.2 -0.8
35 1400 50.6 . 50 -0.6
(Note: In this table, last two columns are the parts of solution)
Solution:
The road passes from cutting to banking in between the stations 30 (1200m) and 31
(1240m). The distance where is passes through zero (i.e. ground level) is given by ' ' as:
From symmetrical triangles,
or,
( )
So, The length of banking portion is 17 m. & the

length of cutting portion is 40 – 17 = 23 m.
CALCULATION OF QUANTITIES
B = 10 m, s = 2 for banking and s = 1.5 for cutting
Stations Depth Mean Area of Area of Total Length Quantity
or or depth or central sides sectional between (B d + S ) × L
Chain- Height Height portion (S ) area stations Filling Cutting
age (d) (Bd) (Bd+S ) (L)
1000 1 … … … … … …
1040 0.9 0.95 9.5 1.81 11.31 40 452.4
1080 1.1 1 10 2.00 12 40 480
1120 0.6 0.85 8.5 1.45 9.95 40 398
1160 0.6 0.6 6 0.72 6.72 40 268.8
Passes 1200 0.3 0.45 4.5 0.41 4.91 40 196.4
from 1217 0 0.15 1.5 0.05 1.55 17 26.35
filling to 1240 – 0.4 – 0.2 2 0.06 2.06 23 47.38
cutting 1280 – 0.8 – 0.6 6 0.54 6.54 40 261.6
1320 – 0.9 – 0.85 8.5 1.08 9.58 40 383.2
1360 – 0.8 – 0.85 8.5 1.08 9.58 40 383.2
1400 – 0.6 – 0.7 7 0.74 7.74 40 309.6
1821.95 1384.98
(– sign indicates cutting) Total Quantity:
cu. m. cu. m.
Earthwork in Hill Road
case (i) : Fully in Banking or Fully in Cutting

Here, Transverse slope or cross slope of ground = r : 1 (H : V)
Side slope of bank or of cutting = s : 1 (H : V)
Height of bank or Depth of cutting at centre = d
Half formation width = b
In Banking (Filling) In Cutting
( )
case (ii) : Partly in Banking and Partly in Cutting
Here,
Side slope of banking = s : 1
Side slope of cutting = p : 1
( ) ( )
If G, falls on the right side of the centre F, then areas can be found by the same method
with the signs interchanged, i.e.
( ) ( )
Note: (i) If C.L. lies on cut side then use (+) sign in formula of area of cut.
(ii) If C.L. lies on fill side then use (+) sign in formula of area of fill.

 Calculate earthwork of given chainage of hill road having Cross slope 8:1, Chain age interval
- -
30m, Formation width 16 m, Side slope in cutting 1:1.

Chainage - 10 11 12 13 14
R.L. of Ground 180.5 183.36 185.52 187.1 186.5
R.L. of Formation 180.5 182 183.5 185 186.5
Solution:
Here, the Area of Cut is found out by using the

b = 16 ÷ 2 = 8 m formula;
r=8 ( )
s=1
Depth Mean Length Volume

Chain- R.L. of R.L. of Area of
of cut r s Area (A) (L) (A*L)
age Ground Formation cut
(GL–RL) sq. m. m. cu. m.
10 180.5 180.5 0 8 1 1.016 – – –
11 183.36 182 1.36 8 1 25.000 13.008 30 390.242
12 185.52 183.5 2.02 8 1 37.994 31.497 30 944.914
13 187.1 185 2.1 8 1 39.629 38.812 30 1164.349
14 186.5 186.5 0 8 1 1.016 20.323 30 609.676
Total: 3109.181
 A road is to be constructed in hill area with formation widths of 10m in banking and 8m in
cutting. Side slope in banking is 2 : 1 and side slope in cutting is 1½ : 1. The heights of filling
or the depths of cutting at the centres of the road and the cross slopes of the ground at
intervals of 30 metre are as given below. Calculate the quantities of earthwork for the length
of 210 metre.
Chainage (m) Depth of cutting (cm) Height of banking (cm) Cross slope of ground
-
0 60 – 10 : 1
30 70 – 12 : 1
60 50 – 15 : 1
90 40 – 12 : 1
120 – 70 10 : 1
150 – 60 15 : 1
180 – 80 12 : 1
210 – 90 10 : 1
Solution:
The road passes from cutting to banking in between chain ages 90m and 120m and
-
passes through zero.

For filling; b = ⁄ = 5 m, s=2
For cutting; b = ⁄ = 4 m, p = 1.5
Here,
The distance of zero point from chainage 90m:
-
or, 0.7 = 12 – 0.4

or, 1.1 = 12
= 11 m (approx.)
So, the length of cutting portion = 11 m.
& the length of filling portion = 30 – 11 = 19 m.
Mean harmonic cross slope of ground at zero point, = 11

At zero point one-half of road will be in cutting and another-half will be in banking, d = 0,
and formation width may be taken as = 9 m, i.e. b = 4.5 m.
( ) ( )
At zero point sectional area of cutting portion = = = 1.07
( ) ( )
At zero point sectional area of filling portion = = = 1.13
CALCULATION OF QUANTITIES
b = 4 m for cutting, b = 5 m for banking, s = 1.5 for cutting & s = 2 for banking
( )
( )
Ht. of
Mean
bank or Cross Quantity
Chain- Sectional sec.
depth slope of Distance,
age s b area, A area
of ground, L (m) Filling
(m) (sq. m.) (sq. Cutting
cutting, r (cu.
m.) (cu. m.)
d (m) m.)
0 – 0.6 1.5 4 10 5.71 … … …
30 – 0.7 1.5 4 12 6.60 6.16 30 184.70
60 – 0.5 1.5 4 15 4.53 5.57 30 166.98
Passes 90 – 0.4 1.5 4 12 3.66 4.10 30 122.86
from 101 0 1.5 4.5 11 1.07 2.37 11 26.04
cutting 2 4.5 11 1.13 … … …
to filling 120 0.7 2 5 10 8.83 4.98 19 94.65
150 0.6 2 5 15 7.07 7.95 30 238.52
180 0.8 2 5 12 9.90 8.49 30 254.55
210 0.9 2 5 10 11.58 10.74 30 322.28
Total: 500.58 910.01
Total quantity of cutting = 500.58 cu. m.
Total quantity of filling = 910.01 cu. m.

 Estimate by centreline method the quantities of the following items of a two roomed
building;
(i) Earthwork in excavation in foundation; (ii) Lime concrete in foundation; (iii) 1st class
brickwork in cement mortar 1:6 in foundation & plinth; (iv) 2.5cm c.c. damp proof course.
Doors D – 1.2 m × 2.1 m Windows W – 1 m × 1.5 m
DETAILS OF MEASUREMENT AND CALCULATION OF QUANTITIES

Here, total centre length of wall = 2 × c.c. long wall + 3 × c.c. short wall
= 2 × 10.6 + 3 × 6.3 = 40.1 m
Ite Height
Particulars of Length Breath Quantity
m No. or Explanatory notes
Items (m) (m) (cu. m.)
no. Depth
1. E/W in total centre length =
excavation in 1 39 1.1 1 42.9 4.1 m
foundation L = 40.1 – 1.1 = 39 m
2. Lime concrete in
1 39 1.1 0.3 12.87 L = 40.1 – 1.1 = 39 m
foundation
3. 1st class
brickwork …
1st footing 1 39.3 0.8 0.2 6.29 L = 40.1 – 0.8 = 39.3
2nd footing 1 39.4 0.7 0.1 2.76 L = 40.1 – 0.7 = 39.4
3rd footing 1 39.5 0.6 0.1 2.37 L = 40.1 – 0.6 = 39.5
4th footing 1 39.6 0.5 0.1 1.98 L = 40.1 – 0.5 = 39.6
Plinth wall above
footing 1 39.7 0.4 0.8 12.7 L = 40.1 – 0.4 = 39.7
Total: 26.1
4. DPC 2.5 cm c.c. 1 39.7 0.4 – 15.88 L = 40.1 – 0.4 = 39.7
Deduct door sill 2 1.2 0.4 – 0.96
Net: 14.92
 Estimate the quantities of the following items of work from the given Septic tank and Soak-
pit drawings.
i) Earthwork in excavation
ii) Cement concrete 1:3:6
iii) Brickwork in 1:4 cement mortar in septic tank
iv) Brickwork in 1:6 cement mortar in soak-pit
Ite Height
Particulars of Length Breath Quantity
m No. or Explanatory notes
Items (m) (m) (cu. m.)
no. Depth
1. E/W in
excavation
 Septic tank 1 2.8 1.7 1.95 9.28 Ht. = 30 + 140 + 5 +
 Soak-pit up to 20 = 1.95 m
3m depth 1 × 3 9.42
 Soak-pit lower
portion 1 × 0.2 0.3
Total: 19 cu. m.

2. Cement concrete
1:3:6
 Floor in
foundation 1 2.8 1.7 0.2 0.95 Average thickness
 Sloping floor 1 2 0.9 0.05 0.09 = 5 cm
Total: 1.04
3. Brickwork in 1:4
c/m in septic tank
Long Walls:
1st step
2nd step 2 2.6 0.3 0.6 0.94
Short Walls: 2 2.4 0.2 1.15 1.1 Ht. = 1.95 – (0.6 +
1st step 0.2) = 1.15 m
2nd step 2 0.9 0.3 0.6 0.32
2 0.9 0.2 1.15 0.42
Total: 2.78
4. Brickwork in 1:6
c/m in soak-pit
 Upper portion 1 π × 1.2 0.2 0.5 0.38 L = mean
 Lower portion 1 π × 1.2 0.2 0.2 0.15 circumference
Total: 0.53
 Estimate
[5] VALUATION
Intro
Valuation is the technique of estimating or determining the fair price or value of a
property such as building, factory, other engineering structures of various types, land, etc.
 By valuation the present value of a property is determined.
 The present value of property may be decided by its selling price, or income or rent it may fetch.
Factors affecting value of a property

i) Structure of the property v) Bank interest
ii) Life of the property vi) Legal control
iii) Maintenance of the property vii) Supply and demand of valuation
iv) Location viii) Purpose of valuation
Purpose of Valuation
i) Buying or Selling Property:
When it is required to buy or sell a property, is valuation is required.
ii) Taxation:
To assess the tax of a property its valuation is required. Taxes may be municipal tax,
wealth tax, property tax, etc.
iii) Rent Fixation:
Rent is usually fixed on certain percentage of the amount of valuation. (6% to 10%)
iv) Security of Loans or Mortgage:
When loans are taken against the security of the property, its valuation is required.
v) Compulsory acquisition:
Whenever a property is acquired by law, compensation is paid to the owner. To
determine the amount of compensation valuation of the property is required.
vi) Valuation of a property is also required if Insurance, Battlement charges, Speculation, etc.
Terms related to Valuation
a. Scrap Value
Scrap value is the value of dismantled materials. For a building when the life is over at
the end of its utility period, the dismantled materials as steel, bricks, timber etc. will fetch a
certain amount called scrap value of the building.
 The cost of dismantling and removal of the rubbish material is deducted from the total receipt
from the sale of usable material to get scrap value.
 For machine; scrap value is the cost of material only.

32 VALUATION Notes by: Shambhu Kumar Shah
b. Salvage Value
It is the value at the end of the utility period without being dismantled.
 A machine after the completion of its usual life span or when it becomes uneconomic, it may be
sold and one may purchase the same for other purposes, the sale value of the machine is called
as salvage value.
 Normally, scrap value and salvage value of a property or an asset get some positive figure, but
sometimes it may also be zero or negative charge.
c. Market Value
The market value of a property is the amount which can be obtained at any particular
time from the open market if the property is put for sale.
 The market value will differ from time to time according to demand and supply.
 It is also changed from time to time due to change on fashion, means of transport, cost of
material and labour, etc.
d. Book Value
The book value of a property at particular year is the original cost minus the amount of
depreciation up to the previous year.
 The book value depends on the amount of depreciation allowed per year and will be gradually
reduced year to year and at the end of the utility period of the property, the book value will be
only scrap value.
e. Rateable Value
Rateable value is the net annual letting value of a property, which is obtained after
deducting the amount of yearly repairs from the gross income.
f. Obsolescence
The value of property or structure becomes less by its becoming out of date in style in
structure, in design etc. and this is called obsolescence.
 The obsolescence may be due to the reason such as progress in arts, change in fashion, change
in planning ideas, new inventions, improvement in design technique etc.
 E.g.; an old dated building with massive walls, arrangement of rooms not suited in present day
becomes obsolete even if it is maintained in a very good condition.
g. Annuity
Annuity is the annual periodic payments for repayments of the capital amount invested
by a party.
 These annual payments are either paid at the end of the year or at the beginning of the year,
usually for a specified number of years.
 If the amount of annuity is paid at the beginning of each year, it is called annuity due.
 If the payment of annuity begins at some future date after a number of years, this is known as
Deffered Annuity.
h. Capital Cost
Capital cost is the total cost of the construction including land, or the original total
amount required to possess a property. It is the original cost and does not change, while value of
a property is the present cost which may be evaluated by valuation.
i. Capitalised Value
The capitalised value of a property is the amount of money whose annual interest at the
highest prevailing rate of interest will be equal to the net income from the property.
 To determine the capitalised value of a property it is required to know the net income from the
property and the highest prevailing rate of interest.
Capitalised Value = Net annual income × Year’s purchase.
j. Year’s Purchase
It is the capital sum required to be invested in order to receive an annuity of Rs. 1.00 at a
certain rate of interest.
 For 4% interest per annum, get Rs. 4.00 requires Rs. 100.00 to be deposited in the bank.
Thus, Year’s purchase = Where, = rate of interest in decimal
 The year’s purchase will be reduced in such a way that income of the property will provide both
for interest on the capital and for accumulation of the sinking fund to replace the capital.
Where, s = sinking fund
In such cases, Year’s purchase =
to replace Rs. 1 at the end of the given period
k. Sinking Fund
The fund which is gradually accumulated by way of periodic or annual deposit for the
replacement of the building or structure at the end of its useful life is term as sinking fund.
 The main objective of creating sinking fun is to accumulate sufficient money to meet the cost of
construction or replacement of the building or structure after its utility period.
 The cost of land is not taken into account in calculating Sinking fund as land remains intact.
 The amount of annual instalment of the sinking fund may be found by:
Where, = annual instalment required
S = total amount of sinking fund to be accumulated
( ) = rate of interest in decimal
n = number of years required to accumulate the sinking fund
l. Depreciation
Depreciation may be defined as the decrease or loss in the value of a property due to
structural deterioration, used life, wear and tear, decay and obsolescence.
Methods of Calculating Depreciation

i) Straight line method
In this method, it is assumed that the property losses its value by the same
amount every year. A fixed amount of the original cost is deducted every year, so that at
the end of the utility period only the scrap value is left.

( )
ii) Constant percentage method or Declining balance method

In this method, it is assumed that the property will lose its value by a constant
percentage of its value at the beginning of every year.
⁄
( )
Methods of Valuation
Following are the different methods of valuation:
i) Rental method of valuation iv) Valuation base on cost
ii) Direct comparisons of the capital value v) Development method of valuation
iii) Valuation based on profit vi) Depreciation method of valuation
(i) Rental method of valuation

In this method, the net income by way of rent is found out by deducting all outgoings
from the gross rent. A suitable rate of interest as prevailing in the market is assumed and year’s
purchase is calculated. This net income multiplied by Y.P. gives the capitalised value or valuation
of the property.
(ii) Direct comparison of the capital value

This method may be adopted when the rental value is not available from the property
concerned. In such cases the capitalized value of the property is fixed by direct comparison with
capitalized value of similar property in the locality.
(iii) Valuation based on profit

This method is suitable for buildings like hotels, cinemas, theatres, etc. for which the
capitalized value depends on the profit.
(iv) Valuation based on cost

In this method the actual cost incurred in constructing the building or in possessing the
property is taken as basis to determine the value of property.
(v) Development method of valuation

This method of valuation is used for the properties which are in the undeveloped stages
or partly developed and partly undeveloped stage. If a large place of land is required to be
divided into plots after providing for roads, parks, etc. this method of valuation is adopted.
(vi) Depreciation method of valuation

According to this method of valuation the building should be divided into four parts, viz.
Walls, Roofs, Floor and Doors & Windows; and the cost of each part should first be worked out
on the present-day rates by detailed measurements.
The depreciated value of each part is ascertained by the formula: ( )

Where, P = Cost at present market rate r d = fixed percentage of depreciation
Different values of r d
Life of structures rd
100 yrs. 1.0 (100/100 = 1)
75 yrs. 1.3
50 yrs. 2.0 (100/50 = 2)
25 yrs. 4.0
20 yrs. 5.0 (100/20 = 5)
Valuation Principle
The value of a commodity or an asset to the firm or its investors is determined by its
competitive market price. The benefits and costs of a decision should be evaluated using those
market prices. When the value of the benefits exceeds the value of the costs, the decisions will
increase the market value of the firm.
i) Time value of money and Interest rates

In many cases, costs and benefits occur at different times, we must incorporate the Time
Value of Money when making a financial decision. This is the difference in value between money
today and money in future. Also, it is the observation that two cash flows at different points in
time have different values.
Present Value – The value of a cost or benefit compounded in terms of cash today.
Future Value – The value of a cash flow that is moved forward in time.
ii) The NPV Decision rule

Net Present Value (NPV) is defined as the difference between the present value of
project or investment’s benefits and the present value of its costs.
iii) The law of one price

The practise of buying and selling equivalent goods or portfolios to take advantage of
price difference is called arbitrage. Such situations where it is possible to make a profit without
taking any risk or making any investments are called arbitrage opportunity. This concept is the
Law of One Price. In competitive markets, securities or portfolios with the same cash flows must
have the same price.

Property Valuation Report

A property valuation report is a document that provides a detailed assessment of the
condition and value of an entire property.
 A property valuation report is given to the property owner to indicate the condition of the
property (land, building, vehicle, factory, plant, etc.) and how much it is worth in the market.
1. Introduction or Executive Summary

The summary may include information such as the history of the property, its location,
previous use and other relevant information. This will give the reader a general idea of the
condition of the property.
 In creating, a structure for valuation report, it is ideal to use the method of discussing the
important aspects first.
a) Land Particulars
After the introduction, general idea of the environment of the property’s
location is given. Overall feel of the neighbourhood, the community is explained in detail and
also if it is located in a busy city or in rural place.
b) Details of the Property

This includes the description of the structure. [If the report is for an existing
building; the number of rooms and bathrooms, total lot area, number of storeys, size of the
garage and other details are included. Description of the pool may also be included if there is
one.] Improvements and repairs that are needed on the property are assessed.
c) Market
Some of the details that are included here are; the date of purchase of the
property, the price when it was purchased, mortgage details and also tax details. It is
required to be as detailed as possible in computing, so that the results will be accurate.
2. Valuation Summary
This part summarise the property valuation report. The summary must contain the
valuation of the property based on the previous details and computation that were done.
Solved Problems
1) Workout the valuation of property from the following data:

Total plinth area of building = 300
Prevailed plinth area rate = Rs. 15000 / plinth area
Age of building = 25 years
Life of building = 75 years
Scrap value = 10 %
Solution:
Original value of building = Plinth area × Plinth area rate = 300 × 15000 = 4500000
Depreciated value of building ( )
( ) = Rs. 1621785.22
Scrap value = 10 % of the building cost = 0.1 × 4500000 = Rs. 450000
Total value of building at present = Depreciated value – Scrap value

= 1621785.22 – 450000 = 1171785.22
Lump sum value of building = Rs. 1171000 .
2) A three storied building is standing on a plot of land measuring 800 sq. m. The plinth area of
each story is 400 sq. m. The building is of RCC framed structure and the future life may be
taken as 70 years. The building fetches a gross rent of Rs. 1500 per month. Workout the
capitalised value of the property on the basis of 6% net yield. For sinking fund 3% compound
interest may be assumed. Cost of land may be taken Rs. 40 per sq. m. Other data required
may be assumed suitably.
Solution:
Gross income per year = 1500 × 12 = Rs. 18000
Outgoing per annum (assuming suitable data):-
i) Annual instalment for Sinking fund, required to accumulate the cost of the
building {which is at the rate of Rs. 150 per sq. m. of plinth area (assumed)} in 72
yrs. @ 3% interest
So, S = 3 storey × 400 m2 × 150 per m2 = 3 × 400 × 150 = 180000
= 180000 × 0.0043 = Rs. 774

( ) ( )
ii) Property tax @ 5% of gross income = 18000 × 0.05 = Rs. 900

iii) Insurance premium @ 0.5% of gross income = 18000 × 0.005 = Rs. 90
iv) Management charges @ 6% of gross income = 18000 × 0.06 = Rs. 1080
v) Maintenance charges @ 10% of gross income = 18000 × 0.10 = Rs. 1800
vi) Municipal taxes @ 15% of gross income = 18000 × 0.15 = Rs. 2700
Total outgoing per annum = Rs. 7344

Net income = Gross income – Expenses = 18000 – 7344 = Rs. 10656
Year's Purchase (Y.P.) = ⁄ = ⁄

Capitalised value of building = Net income × Y.P. = 10656 × ⁄ = Rs. 177600
Cost of land @ Rs. 40 per sq. m. = 800 × 40 = Rs. 32000
Total value of the property = 177600 + 32000 = NRs. 209600 .

3) A coloniser intends to purchase a land of 1,00,000 sq. m. area located in the suburb of a big
city to develop it into plots of 700 sq. m. each after providing necessary roads and parks and
other amenities. The current sale price of small plots in the neighbourhood is Rs. 30 per sq.
m. The coloniser wants a net profit of 20%. Workout the maximum price of the land at which
the coloniser may purchase the land.
Solution:
Total area of land = 1,00,000 sq. m.
Deducing, 30% for roads, parks, etc. = 30,000 sq. m.
Net area of land = 70,000 sq. m.
No. of plots @ 700 sq. m. per plot = = 100
Selling price per plot @ Rs. 30 per sq. m. = 700 × 30 = Rs. 21,000
Total price from sale of all plots = 100 × 21,000 = Rs. 21,00,000
Expenses:
i) Expenditure for improving land @ Rs. 1 per sq. m. = 100,000 × 1 = Rs. 100,000
ii) Cost for providing Road, drainage, water supply
and electrification @ Rs. 3 per sq. m. of land = 100,000 × 3 = Rs. 300,000
iii) Engineer’s & Architect’s fee @ 5% of the sale price = 2,100,000 × 0.05 = Rs. 105,000
iv) Coloniser’s profit @ 20% of the sale price = 2,100,000 × 0.20 = Rs. 420,000
Total Expenditure = Rs. 925,000
Maximum price of land in the undeveloped stage = 2,100,000 – 925,000 = Rs. 1,175,000
Maximum rate of purchase = = Rs. 11.75 per sq. m.
The coloniser may purchase the land @ Rs. 11.75 per sq. m. for a total amount of Rs.
11.75 lakhs.
4) Workout the valuation of a factory building with the following data: (assume any data, if
required)
i) Cost of land for life time period of the Factory Building is NRs. 64,00,000
ii) Gross income per year is NRs. 1,00,00,000
iii) Staff salary, water supply, electrical charge and telephone bill at the rate of 20% of
gross income.
iv) For repair and maintenance of machinery equipment, plants, etc. at the rate of 7%
of their capital cost of NRs. 22,50,000
v) Sinking fund for machinery with 30 years life at the rate of 5% on 90% of their capital
cost.
vi) Insurance premium per year is NRs. 1,80,000
Yearly charges for cold storage at the rate 8% & redemption of capital at the rate of 4%.
[Assume purchase for 60 years @ 8% and redemption of capital cost @ 4%.]
Solution:
Gross income (GI) = NRs. 1,00,00,000
Capital cost = NRs. 22,50,000
Expenses:
i) Staff salary, w/s, tel. @ 20% of Gross income = 0.2 × 1,00,00,000 = Rs. 20,00,000
ii) Repair & maintenance @ 7% of capital cost = 0.07 × 22,50,000 = Rs. 1,57,500
iii) Sinking fund (90% of capital cost or 10% of scrap value) for 30 years @ 5% interest;
= Rs. 30,479.15
( ) ( )
iv) Insurance premium = Rs. 1,80,000
Total Expenses = NRs. 23,67,979.15
Net income = Gross income – Expenses
= 1,00,00,000 – 23,67,979.15 = Rs. 76,32,020.85
Capitalised value of building invest = Net income × Y.P. = net income × ⁄

= 76,32,020.85 × ⁄ = NRs. 9,54,00,260.63 .
Redemption @ 4% = 76,32,020.85 × 0.04 = Rs. 3,05,280.83
[According to the added portion:]

Where, = coefficient of sinking fund
Year’s Purchase,
= rate of interest on capital
Coefficient of sinking fund for 60 years;
= 0.0042
( ) ( )
Y.P. = = 11.88
Capitalised value = Net income × Y.P.

= 76,32,020.85 × 11.88 = NRs. 9,06,68,407.70
So, Total Valuation = 9,06,68,407.70 + 64,00,000 = NRs. 9,70,68,407.70 .

5) Workout the valuation of the cinema hall with the following data:
i) Cost of land = Rs. 5,500,000
ii) Gross income = Rs. 12,000,000
iii) Expenses undergone per year:
a) To run cinema including staff salary, electricity charges, municipal taxes,
license fee, stationary and printings etc. is 30% of gross income.
b) Repair and maintenance of plants, machinery and tools at 5% of their capital
cost, which is Rs. 10,000,000.
c) Sinking fund for machinery whose life is estimated as 30 years at 5% after
allowing 10% scrap value.
d) Insurance premium is Rs. 155,000 per year.
Assume years purchase for 60 years at 8% and redemption of capital 8%. Annual repair
of hall is 2% of gross income.
Solution:
Gross income (GI) = Rs. 12,000,000
Capital cost = Rs. 10,000,000
Expenses:
i) Staff salary @ 30% of Gross Income = 0.3 × 12,000,000 = Rs. 3,600,000
ii) Repair & maintenance @ 5% of capital cost = 0.05 × 10,000,000 = Rs. 500,000
iii) Sinking fund (90% of capital cost or 10% of scrap value) for 30 years @ 5% interest;
= Rs. 1356462.92
( ) ( )
iv) Insurance premium = Rs. 155,000
v) Annual repair of Hall @ 2% of gross income = 0.02 x 12,000,000 = Rs. 240,000
Total Expenses = NRs. 5,851,462.92
Net income = Gross income – Expenses
= 12,000,000 – 5,851,462.92 = Rs. 6,148,537.08
Now, Year’s Purchase, Y =
Where, = 0.0008
( ) ( )
Y= = 24.51
Capitalised value = Net income × Y.P.

= 6,148,537.08 × 24.51 = NRs. 150,700,643.8
So, Total Valuation = 150,700,643.8 + 5,500,000 = NRs. 156,200,643.80 .
SPECIFICATION
Specification describes the nature and class of work, materials to be used, workmanship,
etc. and is very important for the execution of work. Cost of work depends upon the
specification. It should be clear without any ambiguity anywhere.
 Only drawing do not furnish the details of different items of work, the quantity of materials,
proportion of mortar and workmanship, which are described in specification.
 During writing specification attempts should be made to express all the requirements of the
work clearly and in a concise form avoiding repetition.
Clauses of the specification should be arranged in the same order in which the work will be
carried out.
 Specification depends on the nature of the work, the purpose for which the work is required,
strength of materials, availability of materials, quality of materials, etc.
1) General or Brief Specification

 It is a short description of different parts of the work specifying materials, proportions,
qualities, etc.
 General specification gives general idea of the whole work or structure and is useful for
preparing the estimate.
 It also gives the nature and class of work and materials in general terms, to be used in various
parts of the work from foundation to the superstructure.
2) Detailed Specification
 The detailed specification is a detailed description and expresses the requirement in details.
 The detailed specifications of an item of work specify the qualities and quantities of materials,
the proportion of mortar, workmanship, the method of preparation and execution and the
method of measurement.
 The detailed specifications of different items of work are prepared separately and describe
what the works should be and how they shall be executed and constructed.
 The detailed specifications, if prepared clearly are very useful for execution of the work, so it is
an essential part of contract document.
Specification of Cement Concrete 1:2:4

(i) Materials : Aggregate (clean, dense, hard, durable)
Water
Sand
Cement
(ii) Proportion : 1:2:4
(iii) Hand mixing : Turning 3 times
(iv) Machine mixing : 2 minutes of rotation / output: 15 – 20 mix per hr.
(v) Slump : (7.5cm – 10cm) slump test result

42 SPECIFICATION Notes by: Shambhu Kumar Shah
(vi) Formwork : Side forms – 3 days

Form – 14 days
(vii) Laying : < 15 cm (6”) *no honey combing & air holes+
(viii) Curing : After two hours of laying it should be kept damp by covering with
wet gummy bags or wet sand for 24 hrs. and then cured by flooding
for 15 days.
# Approximate quantity of water required for cement may be taken 30% by weight of cement +
5% by weight of total aggregate.
# For concrete compacted by mechanical vibrators, the quantity of water shall be reduced by
20%.
† lekIr †
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NISSAN FOUNDATIONS

Introduction, Methods of Estimating, Preparation of Detailed Estimate, Types of Estimates

An estimate is a computation or calculation of the quantities required and expenditure

Units of Measurements and Payments for Various Items of Works

By: nissan URL: www.sentientsep.wordpress.com

08. Brick work in foundation and plinth cu. m.

Main Items of Works and their Methods of Measurements

3. Centring & Shuttering of RCC work

5. Honey comb brickwork

By: nissan URL: www.sentientsep.wordpress.com

7. Door and Window shutters

10. Cement Pointing

11. Cement Painting

12. Water supply & Sanitary work

13. Electrical work

14. Dismantling & Demolition

By: nissan URL: www.sentientsep.wordpress.com

Method of Building Estimate or Methods of Taking Quantities

Method I : Long wall & Short wall Method

Total length (L) = 10.2 + 7.8 = 18 m

Since, Quantity = length (L) × breadth (B) × height (H)

Quantity = 18 × 0.1 × 4 = 7.2 cu. m.

Method II : Centreline Method

Total centre length of wall

Since, Quantity = length (L) × Breadth (B) × Height (H)

For Two Roomed building:

But, Quantity = length (L) × Breadth (B) × Height (H)

Here, L = total centre length – number of overlaps × ½ breadth = 30 – 2 × ½ × 0.1 = 29.9 m

Method III : Crossing Method

By: nissan URL: www.sentientsep.wordpress.com

[2] TYPES OF ESTIMATE

2) Plinth Area Estimate

3) Cube Rate Estimate

7) Annual Repair or Maintenance Estimate

By: nissan URL: www.sentientsep.wordpress.com

 Departmental or Centage Charges / Supervision charges

 Administrative Approval or Sanction

Split up of Cost of Building work

By: nissan URL: www.sentientsep.wordpress.com

vi. Wood works – D/W : 15 %

Terms used for Preparing Preliminary Estimation

ii. Floor Area

iii. Circulation Area

iv. Carpet Area

Complete Estimate of a Project

(vi) Cost for supervision charges during execution of works.

 Prepare a preliminary estimate of a building with the following data.

Total Cost = 19,52,30,715

Contingencies and supervision charge = 7.5% of total cost = 1,46,42,303.63

Grand total Cost of the building = NRs. 20,98,73,018.63 .

By: nissan URL: www.sentientsep.wordpress.com

[3] RATE ANALYSIS

Factors affecting Rates

The miscellaneous expenses on overheads may be under the following heads:-

Task or Out-turn Work

1. Rate Analysis for PCC (1:2:4) for 1 m3.

Particulars Unit Quantity Rate Amount