3. Cost of equipment - Calculation of work-hour used for equipment is dependent upon the type of equipment utility. Some equipments are used for specific purpose where as some of it are used for different work simultaneously. Generally equipment used individually is calculated for each item of work. For these equipments, it is not possible to calculate the cost; the equipment charge can be added as overhead. For example, installation of a batching plant requires special effort and it is not easy to distribute its initial cost on the concreting. We can incorporate such kind of work as establishment charges or overhead.


4. Overhead cost – During the period of construction, a company has to maintain an office or depreciation of its equipments may take place. This is usually taken as 2-5% of unit rate.

Part of the overhead is directly related to the construction of an item of work. Such expenses include –

1. Repair and depreciation of tool and plants


2. Salaries of supervisors, etc; who are indirectly involved in the work


3. Temporary godown and sheds to store the material at the site


4. Lighting arrangements


5. Labour welfare