Where do you extract the ORIGINAL PRICES from for calculating a NET CHANGE?

The original prices for calculating a net change are typically extracted from the estimate. The estimate provides a detailed breakdown of project costs that reflects the anticipated expenses associated with materials, labor, and overhead for the entire project. This figure serves as a benchmark against which any changes, or net changes, can be assessed.

When changes occur during the project, such as scope adjustments or unforeseen conditions, the net change calculation will involve comparing the original prices outlined in the estimate with the new costs incurred due to these changes. By referring to the estimate, contractors can ensure that adjustments are made based on the agreed-upon costs at the outset of the project, leading to accurate financial management and reporting.

Other documents, like change order documents, budget reports, and bid proposals, serve different purposes in project management. Change order documents specify modifications made after the initial agreement and reflect changes rather than original prices. Budget reports provide an overview of current spending and allocations but may not clearly depict the original cost breakdown. Bid proposals represent initial offers but may include adjustments that are not purely reflective of original intended costs. Thus, the estimate is the most reliable source for original prices when calculating a net change.