NM General Contractor flashcards
NM General Contractor · Build recall with a focused review session.
32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Working capital formula
- Current assets minus current liabilities. It measures short-term liquidity available to fund payroll, materials, and retainage gaps on active construction jobs.
- Break-even revenue calculation
- Total fixed overhead divided by gross margin percentage. A firm with $300,000 overhead and 20% margin needs $1,500,000 in annual volume before earning any profit.
- Labor burden
- Payroll taxes, insurance, benefits, and other costs added on top of base wage. Burden typically runs 25–40% of base wage for field construction labor.
- Percentage-of-completion method
- Revenue and cost recognition in proportion to work completed, usually measured by costs incurred to date divided by total estimated costs. It smooths reported results across periods.
- Retainage receivable
- Money withheld from progress payments until contract conditions are met. It is an asset on the balance sheet, not cash, and must be tracked by project and age.
- New Mexico CID
- The Construction Industries Division of the Regulation and Licensing Department administers contractor licensing, permits, and trade regulation for construction work in New Mexico.
- Qualifying party requirement
- The individual who passes the trade and business/law exams and holds the license through the contracting entity. Loss of that person generally requires prompt replacement.
- Unlicensed contracting consequences
- Working without a required New Mexico license can make a contract unenforceable for collecting compensation and exposes the contractor to citations, penalties, and discipline.
- License number on documents
- New Mexico rules require the contractor license number to appear on advertisements, bids, and contracts. Misrepresenting license status is a violation subject to discipline.
- Workers' compensation proof
- Contractors must carry workers' compensation coverage for employees and provide proof. Failure to maintain required coverage can result in license suspension.
- Pay-when-paid clause
- A subcontract provision tying subcontractor payment to the owner's payment to the prime contractor. It affects timing of payment rather than eliminating the obligation in many jurisdictions.
- Substantial completion
- The stage when work is sufficiently complete for its intended use. It triggers warranty start, retainage release eligibility, and often reduces liquidated damages exposure.
- Liquidated damages test
- The amount must be a reasonable forecast of probable loss at contract formation. Clauses disproportionate to anticipated harm are treated as unenforceable penalties.
- Notice as condition precedent
- Contract clauses requiring written notice within a set period for delay, change, or differing site conditions. Missing the deadline can waive entitlement regardless of merit.
- Differing site condition claim
- A claim that physical site conditions differ materially from those shown in contract documents. It generally requires prompt written notice, documentation, and proof of the difference.
- Closeout package contents
- As-built drawings, O&M manuals, warranties, lien waivers, final lien releases, and consent of surety where bonds apply, submitted to confirm project completion.
- Quantity takeoff method
- Measure net quantities from drawings and specifications, then apply waste and overlap factors separately. Keeping factors separate preserves an auditable takeoff.
- Labor cost formula
- Labor hours equal quantity divided by crew productivity rate. Labor cost equals hours times crew average wage times one plus burden percentage.
- Bond premium in bid
- Performance and payment bond premium is typically a percentage of contract value, tiered by contract size, and must be included in the bid price.
- Contingency versus profit
- Contingency covers identifiable risk such as unknowns, escalation, or weather. It is tracked separately from markup for overhead and profit and drawn down as risks occur.
- Unbalanced bid risk
- Front-loading or overpricing early or changed-work items can create cash-flow advantage but may be rejected and increases dispute and audit risk.
- Total float formula
- Total float equals late start minus early start, or late finish minus early finish. It is the delay an activity can absorb without delaying project completion.
- Free float
- The amount of time an activity can be delayed without delaying the early start of any successor activity. It is always less than or equal to total float.
- Crash cost slope
- Crash cost minus normal cost, divided by normal duration minus crash duration. Crash the lowest-slope critical-path activity first to shorten the project economically.
- Cost performance index
- CPI equals earned value divided by actual cost. A CPI below 1.0 indicates the work performed is costing more than budgeted.
- Estimate at completion
- EAC equals budget at completion divided by CPI when current cost performance continues. Alternatively, EAC equals actual cost plus remaining budget when future work is at budget.
- OSHA fall protection threshold
- General construction fall protection is required at 6 feet or more above a lower level. Guardrails, safety nets, or personal fall arrest systems are acceptable systems.
- Excavation protective system
- Excavations 5 feet or deeper require sloping, shoring, or shielding unless entirely in stable rock. A competent person must inspect daily and after rain.
- SWPPP purpose
- A stormwater pollution prevention plan identifies erosion and sediment controls, material storage practices, and inspection schedules required for construction site stormwater compliance.
- Water-cement ratio effect
- Lower water-cement ratio increases concrete strength and reduces permeability. Higher ratio improves workability but reduces strength and durability of the hardened concrete.
- Slip-critical bolted connection
- A structural steel connection that resists shear through friction between faying surfaces. It requires specified surface preparation and bolt tensioning to develop the friction resistance.
- Soil compaction specification
- Compaction is specified as a percentage of maximum dry density from a standard proctor test. Moisture content near optimum allows efficient compaction to the required density.