1) INTRODUCTION

Estimating is the technique of calculating or computing the various quantities and

the expected Expenditure to be incurred on a particular work or project. In case the
funds available are less than the estimated cost the work is done in part or by
reducing it or specifications are altered, the following requirement are necessary for
preparing an estimate.
1. Drawings like plan, elevation and sections of important points.

2. Detailed specifications about workmanship& properties of materials etc.

3. Standard schedule of rates of the current year.

A) TERMS USED IN EARTHWORK IN ROAD CONSTRUCTION

The principal activities in earthworks are:

• Measuring and calculating the volumes

• Excavations (Includes levelling and different types of cuts)
• Loading, Hauling and unloading
• Filling, including spreading and compaction.
Some technical terms associated with road construction are discussed below:

➢ Cutting: Earth that is removed from an area is considered “cut” or excavated

earth

➢ Filling: A fill refers to a volume of earthen material that is placed and

compacted for the purpose of filling in a hole or depression. Embankments or
fills are constructed of materials that usually consist of soil, but may also
include aggregate, rock, or crushed paving material.
➢ Side slope: Side slope means the inclined surfaces of both cuts and fills
required to meet the approved specifications for construction of the roadbed.
Side slope means that area outside of the ditch or road shoulder that is graded
to a uniform slope in order to stabilize the soil between the ditch or shoulder
and the native, undisturbed ground.

➢ Borrow pits: Borrow pits are nothing but the pits dug along the alignment of
the road. They are generally dug to use the earth material from the pits for the
construction of road embankment. Borrow pits should always be dug 5 meters
away from the toe of the embankment.
➢ Shrink/swell factors: Soil shrinkage and swelling, as applied to earthwork
design and calculations, can be defined as the volume change of soil when
moved or distributed from one state to another within a project. Volume of
soil varies from one soil state to another because of the cut and fill practices
and mass hauls that take place on construction sites. This is because an amount
of volume of varies depending on whether the soil is bank, loose, or
compacted material.

➢ Spoil banks: Spoil banks are generally constructed from excavated soil on the
sides of cutting. They are generally constructed parallel to the alignment of
road. Height of spoil bank should not be less than 1.5 m. Care should be taken
that they are constructed 3 m away from top edge of cutting.

➢ Lead and lift: Leads are the horizontal distance between the center of
excavation to the center of the deposition. Lift is the vertical distance of the
lifting of excavated earth required for the construction. Generally, on site, 15
 m lift is taken as initial for which contractors do not get any additional
payments.

➢ Balancing Earth Work: Excavation of earth is required for the construction

process but at the same time balancing of the earth work is also recommended.
There should be no large difference in the earth obtained from cutting to earth
required for filling. To minimize this difference proper selection of gradient
is required.

➢ Mass haul diagram

Haul: A haul refers to the transportation of your project’s excavated materials. The
haul includes the movement of material from the position where you excavated it to
the disposal area or a specified location. A haul is also sometimes referred to as an
authorized haul.
Overhaul: When you get authorization to haul material farther than the original free-
haul distance, the transportation of said material is called an overhaul.
Free haul: A free project’s average haul is referred to as a free haul.

Average haul: You can find the average haul using the mass diagram. The average
haul is a specific area in a mass diagram. It represents how many cubic yard stations
are between balance points divided by the ordinate of mass that the yardage gets
hauled.
A mass haul diagram provides viewers with a graphical representation of the
material moved. In particular, the diagram will showcase the amount of material
that's been transported along the centerline.

Characteristics of mass haul diagram

1.Rising sections of the mass curve indicates areas where excavating exceeds fill,
whereas falling sections indicate where fill exceeds excavation.

2 Steep slopes reflect heavy cuts & Fills, while flat slopes indicate areas fro small
amount of earthwork.
3 The difference in ordinates between any two points indicate net excess of
excavation over embankment or vice versa.
4.Any horizontal line dawn to intersect two points within the same curve indicates a
balance of excavation (cut) and embankment (fill) quantities between the two points.

5.Points of zero slope represent points where roadway goes from cut to fill or from
fill to cut.

6.The highest or the lowest points of the mass haul diagram represents the crossing
points between the grade line (roadway level) and natural ground level.

B) METHOD OF ESTIMATING OF ROAD AND RESTORATION WORKS

Road estimate is prepared by using:

I. Drawings of the work like plan, elevation and sections.
II. Detailed specification of material used
III. Standard schedule of rates of current year.
For road estimate following this are used for fixing cost:

I. Surveying
II. Earthworks
III. Grading
IV. Surfacing
V. Drainage

C) MEASUREMENT FROM FOR QUANTITY

Quantities and cost of the item are calculated by preparing measurement from,
which includes different heading and sub-heading as shown above.

Abstract of estimate form:

After estimating the quantities at the end of the detailed estimate the cost is
prepared. A general form for abstract of estimated cost is shown below:
Restoration works: Restoration treatments are used when the road’s quality has
deteriorated past the point of preservation. Depending on the treatment selected,
restoration treatments require removal of some or most of the existing asphalt
layer.
The road restoration works include following steps:

• Restoration method that removes the existing pavement surface (minimum

40 mm, a deeper depth required if there is rutting) and places new asphalt to
resurface the road. This removes major surface distresses such as potholes
and large cracks.
• Over time, some cracking will re-emerge, which is completely normal. Some
of these types of cracks are referred to as ‘reflective cracks.’ These cracks
exist in the base of the road and are sealed as part of the Crack Sealing
program.
• Resurfacing
• Regular maintenance and repairs.
 2) EARTHWORK IN ROAD CONSTRUCTION

All the civil engineering structures such as buildings, roads, canals, railway lines,
culverts and dams earth work will there. Cross-section of earth work of road in
banking or in cutting is usually in the form of trapezium.

Sectional area= Area of central rectangular portion+ Area of two side triangular
portions=Bd+sd2

S:1 is the ratio of side slopes as horizontal: vertical. For 1 vertical, horizontal is s,
for d vertical, horizontal is sd.
Quantity =(Bd+sd2) x L

Mean height = (d1+d2)/2= dm

Sectional area is taken out from mean height = Bdm +sdm2

Qty = (Bdm + sdm2) x L

Mid-Sectional area method

Quantity = Area of mid-section area x length.

Let d1 & d2 be the height of bank at two ends portion of embankment, L the length
of the
section B

the formation width & S:1(horizontal: vertical).

Area of mid-section = Area of rectangular portion +area of two triangular portion.

Area= Bdm +Sdm2

Quantity of earth work = (Bdm +Sdm2) x L.

General Q = (Bdm +Sdm2) x L where d stands for mean height or depth.

Mean sectional area method

Quantity = Mean sectional area x length.

Sectional area at one end A1 =Bd1 +sd12

Sectional area at other end A2 =Bd2 +sd22, d1 and d2 are the heights or depths at the
two ends
Mean area = (A1+A2)/2=Am

Quantity= Am * L

Prismoidal formula method

Quantity or Volume = 1/6[A1+A2+4Am) where A1

and A2 are the cross-sectional areas at the two ends of a portion of embankment of a
road of length L and Amis the mid sectional area.

Quantity= Am * L

(ALL NUMERICAL FORMULA AND NOTES ARE PROVIDED IN CLASS)

 3) RATE ANALYSIS

In order to determine the rate of a particular item, the factors affecting the rate of
that

item is studied carefully and then finally a rate is decided for that item. This process
of

determining the rates of an item is termed as analysis of rates or rate analysis.

The rate of particular item of work depends on the following.

1. Specifications of works and material about their quality, proportion and

constructional Operation method.

2. Quantity of materials and their costs.

3. Cost of labors and their wages.

4. Location of site of work and the distances from source and conveyance charges.

5. Overhead and establishment charges

6. Profit

Purpose of Analysis of rates:

1. To work out the actual cost of per unit of the items.

2. To work out the economical use of materials and processes in completing the
particulars item.

3. To work out the cost of extra items which are not provided in the contract bond,
but are to be done as per the directions of the department.

4. To revise the schedule of rates due to increase in the cost of material and labor or
due to change in technique.
The Components of Rate Analysis is depending on the effect of it on rate analysis.
The primary Components of Rate Analysis are as below:

1. Material cost:
2. Labor cost

3. Plant & machinery owning and operative charges

4. Water charges

5. Overheads

6. Profit

1. Materials Cost: -
This is the primary Components of Rate Analysis. As per detailed specification,
quantity of an item is calculated. There are various factors like specification,
composition, quality of materials considered for deciding material cost.
Transportation cost, storage & handling cost, loss of theft, losses due to various
factors also take into account while deciding cost of material for rate of analysis.
Based on market rates, per unit rate is calculated.

Following price too is considered: -

• Freight & transportation, as well as loading & unloading
• Taxes & insurance
• Profit on Cement, steel stone chips and bitumen not included if supplied
departmentally.

2. Labor cost:
Following factors are considered for labor prices,
• Number of labors required as per class (Skilled or unskilled & helpers)
• Daily wedges of labor
• Quality of their work
• Capacity of work i.e., or work done per day
3. Equipment, Tools and Plant cost
This cost is calculated on the basis of equipment used for particular work per unit
item.

For example, concrete mixer as per unit of concrete.

Certain tools and plants are tough to allocate as per the specific item hence their cost
are considered in establishment charges.

For some special equipment generally, we consider 1% to 5% of total estimated cost

is provided for purchasing of instruments.

4. Overhead & establishment Charges:

• This charge can be included following charges,
• Office Rent,
• Depreciation on equipment
• Salaries of office staff,
• Postage, lighting, travelling, telephone account
• Theft or loss
• Go-Down rent
• Small tools, planks, ladders, ropes, hand tools for workmen
• Repairs & depreciation for tools and plant
• Lighting at site
• Mobilization of establishment
• Public Relations
• Labor Welfare & safety
• Workmen compensation, insurance
• Interest on investment

This is actually 2.5% up to 5

Overhead charges will increase with delay in project.

5. Profits:

The percentage for profit is depend upon the type of project.

· For small to medium project profit is considered as 15%

· For large project profit is considered as 10%
Factors affecting cost of road, sanitary and water supply works

• Specification of works
• Material used
• Location of the site
• Quantity of materials
• Transportation facilities, charges and condition of road
• Overhead and establishment charges
• Profit desired
• Experience of workers
• Management of work
Government procedure of preparing rate analysis

a) Total cost of materials = Rs. X

b) Total cost of labors= Rs. Y
c) Equipment, Tools and plant= Rs. Z=3% of unskilled labors
d) Sub-total= Rs (X+Y+Z) =A
e) Contractors, Overhead and Profit= 15% of A =B
f) Water charge= 1% (X+Y) =C
g) VAT (if mentioned in the question if not optional) = 13%(A+B) =D
h) Grand total= A+B+C+D

(ALL NUMERICAL FORMULA AND NOTES ARE PROVIDED IN

CLASS)
 4) VALUATION

Valuation is the technique of estimating or determining the fair price or value of a

property such as building, a factory, other engineering structure of various types,
land…etc.

Purposes of Valuation

The main purposes of valuation are as follows:

Buying or Selling Property: When it is required to buy or sell a property, its valuation
is required.
Taxation: To assess the tax of a property, its valuation is required. Taxes may be
municipal tax, wealth tax, Property tax etc, and all the taxes are fixed on the
valuation of the property

Rent Function: In order to determine the rent of a property, valuation is required.

Rent is usually fixed on the certain percentage of the amount of valuation which is
6% to 10% of valuation.
Security of loans or Mortgage: When loans are taken against the security of the
property, its valuation is required.

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.

Valuation of a property is also required for Insurance, Betterment charges,

speculations etc.
Valuation of Building: Valuation of a building depends on the type of the building,
its structure and durability, on the situation, size, shape, frontage, width of roadways,
the quality of materials used in the construction and present-day prices of materials.
Valuation also depends on the height of the building, height of the plinth, thickness
of the wall, nature of the floor, roof, doors, windows etc.
The valuation of a building is determined on working out its cost of construction at
present day rate and allowing a suitable depreciation.

Principle of Valuation

The following are the principle that should be observed at the time of evaluating fair
and reasonable value of property:

➢ Cost depends upon the supply and demand of property

➢ Cost depends upon its design, specification of material used and location of
property
➢ Cost varies with the purpose for which valuation is made
➢ Cost is affected by age of property and its physical conditions.
➢ Present value and future use of any property should be given due weightage
in valuation.
➢ In valuation a vender must be willingly to sell and purchaser willing to buy.

Factors affecting the valuation

1) Location:

Location is the key to the valuation of the property. Buildings, homes, and plots
located in commercial centers and market areas carry high prices than the residential
areas. Then, some plots are located in well-developed and registered colonies would
value higher. The valuation will be higher in freehold land than those on leasehold
plots.
2) Amenities:

The valuation of the properties with better infrastructural capabilities and modern
amenities will have a higher price than those of the properties that fail to provide
better electrification, telephone, sewerage, and other infrastructure facilities. The
facilities like community centers, gyms, children’s parks, parking lots, and general
stores.
3) Infrastructure:

Infrastructure developments are one of the important factors that influence property
cost. The infrastructure development includes communication facilities like roads,
airports, malls, flyovers, hospitals, marketplaces, and other things.

4) Affordability:
Affordability is always an important factor and cost incurred in holding on to the
property. That includes interest rates, property costs, and wages.
5) Structure:

The valuation of property is also related to the type of materials used, design,
layout, durability, and life cycle of the building.

6) Availability of land:
There are places where the availability of land is huge for residential purposes. In
those areas, the cost of the property will be comparatively lower than the places
where the availability of the land is scarce.
7) Demand and Supply:

Demand for real estate properties is inversely proportional to the supply. As the
supply of real estate property decreases, the valuation of the property will increase.

8) Customization:
The cost of real estate property goes up if the builder can customize the residential
space according to the purchaser’s needs. For example, the purchaser wants to have
landscaped terraces or verandahs connected to the flat or stylish kitchens.

Terms Used in Valuation

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. The market
value also changes from time to time for various miscellaneous reasons such as
changes in industry, changes in fashions, means of transport, cost of materials and
labor etc.
Book Value: Book value is the amount shown in the account book after allowing
necessary depreciations. The book value of a property at a particular year is the
original cost minus 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.
Capital cost: Capital cost is the total cost of construction including land, or the
original total amount required to possess a property. It is the original cost and does
not change while the value of the property is the present cost which may be
calculated by methods of Valuation.

Capitalized Value of a Property

The capitalized 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 capitalized value of a property, it is required to know the
net income from the property and the highest prevailing rate of interest.
Therefore, Capitalized Value = Net income x year’s purchase

Year’s Purchase: Year’s purchase is defined as the capital sum required to be

invested in order to receive a net receive a net annual income as an annuity of rupee
one at a fixed rate of interest. The capital sum should be 1×100/rate of interest. Thus,
to gain an annual income of Rs x at a fixed rate of interest, the capital sum should
be x (100/rate of interest).
But (100/rate of interest) is termed as Year’s Purchase.
The multiplier of the net annual income to determine the capital value is known as
the Year’s Purchase (YP) and it is useful to obtain the capitalized value of the
property.
Salvage value: It is the value of end of utility period without being dismantled.

Depreciation: Depreciation is the gradual exhaustion of a usefulness of a property.

Decrease or loss in the value of a property due to its structural deterioration use, life
wear and tear, decay and obsolescence.

Scrap value: Scrap value is the value of dismantled materials. For a building when
the life is over the end of utility period of dismantled materials as steel, bricks,
timber. Etc. will fetch certain amount which is scrap value of a building.
Contingencies: Incidental expenses of miscellaneous character which cannot be
classified approximately under any distinct sub-head, but is added in the cost of
construction necessarily.

Distressed value or Forced value: A distress price refers to the price at which a
company marks down a product or service instead of discontinuing it. It is the
minimum price at which a company can sell an item and make a profit. Distress
prices are often made during difficult market conditions in an attempt to spur sales
and at least cover fixed costs. A company may discontinue the product if it cannot
be sold at a price greater than its variable cost of production.

Annuity: It is defined as the annual periodic payment for repayment of capital

amount invested in a property or in other forms of investment by a party.
Sinking fund
The fund is gradually accumulated by way of periodic on annual deposit for the
replacement of the building or structure at the end of its useful life. A company that
issues debt will need to pay that debt off in the future, and the sinking fund helps to
soften the hardship of a large outlay of revenue. A sinking fund is established so the
company can contribute to the fund in the years leading up to the bond's maturity.

P= Cost price
S= Scrap value

r= Rate of interest

n= useful life period

q= Yearly installment
Difference between Depreciation and Obsolescence

Six Methods of Valuation

1. Rental Method of Valuation

2. Direct Comparisons of the capital value

3. Valuation based on the profit

4. Valuation based on the cost

5. Development method of Valuation

6. Depreciation method of Valuation

(NUMERICALS AND NOTES PROVIDED IN CLASS)
Method Of Writing Valuation Report

After completion of valuation work a report is prepared. And following things must
be included in the report (Which is divided in following parts)
➢ Part I: Introduction with all details of property such as location, date of
purchase, life of the structure, current condition.

➢ Part II: It gives the actual valuation calculation by multiple approaches of final
value as curtained by the valuator.

➢ Part III: This gives the valuator declaration i.e., Valuation is done without any
biasing

➢ Part IV: At the end, all annexures are attached.

Report Format:
• Cover page
• Table of content
• Valuation certificate
• Description of the property
• Land value
• Building value
• Synopsis of valuation
• APPENDIX (DRAWINGS, MAP, RECEIPT, LEGAL DOCUMENTS etc)