NAME – CRASY BOSE (12500117079)

KRITI GUPTA (12500117069)

PRESENTATION ON COST ESTIMATION

WHAT IS COST ESTIMATION?
A COST ESTIMATE IS AN APPROXIMATE PREDICTION OF HOW MUCH
MONEY IS NEEDED TO COMPLETE A PROJECT. IT’S IMPORTANT TO
ACCURATELY ESTIMATE THE COSTS AS IT WILL HELP YOU ASSESS
WHETHER THE PROJECT IS FEASIBLE, I.E. IF YOU HAVE ENOUGH FUNDS
TO BACK IT. IN SHORT, ACCURATE COST ESTIMATING HELPS YOU
MANAGE YOUR PROJECT BUDGET BETTER. 
CONSTITUENTS OF COST
ESTIMATION -
(I) COST OF DESIGN.
(II) COST OF RESEARCH AND DEVELOPMENT.
(III) COST OF DRAFTING.
(IV) COST OF MATERIAL REQUIRED,
(V) LABOUR COST.
(VI) COST OF JIG, FIXTURES AND TOOLS.
(VII) OVERHEAD COST OR INDIRECT COST.
FUNCTIONS OF COST
ESTIMATION -
(I) TO WORK OUT MATERIAL COST AFTER TAKING INTO CONSIDERATION VARIOUS
ALLOWANCES GIVEN FOR DIFFERENT MANUFACTURING OPERATIONS.
(II) TO WORK OUT LABOUR COST AFTER CONSIDERING LABOUR TIME INVOLVED WITH THE
HELP OF PREVAILING WAGE RATES.
(III) TO DETERMINE THE COST OF TOOLING’S, EQUIPMENT AND ACCESSORIES ETC. TO BE
PROCURED FROM OUTSIDE.
(IV) TO DETERMINE DIFFERENT OVERHEAD CHARGES INCLUDING PACKING
TRANSPORTATION, MARKETING AND SELLING ETC.
(V) TO DETERMINE THE SELLING PRICE OF THE PRODUCT AFTER CONSIDERING PROFIT TO BE
REALIZED,
(VI) TO PERFORM LIME AND MOTION STUDY.
CONCLUSION
COST ESTIMATION IS AN ANALYSIS OF INDIVIDUAL COST ELEMENTS
USING ESTABLISHED METHODOLOGIES TO PROJECT FROM DATA TO
ESTIMATED FUTURE COST.
IT HELPS TO DETERMINE A REALISTIC VIEW OF THE LIKELY COST
OUTCOME WHICH CAN FORM THE BASICS OF WORK FOR EXECUTING
PLAN.
THANK YOU