Calculating the Total Construction Cost
The total construction cost of the hospital project is the sum of line
items A to D as noted in Figure 1 and is labeled as line item E. This cost is a critical determinant of other values that comprise the total project cost. One can readily see that only reporting the total construction cost to the board of directors, financial partners, or other decision makers can be a disastrous underrepresentation of the total cost of a project. If the cost of construction figure is used to acquire financial sources to fund the project, the project could be seriously underfunded requiring new sources of funding or serious downsizing of the original plans.