Certified Professional Public Buyer (CPPB) Practice Test

What signifies the result of costs that were impacted due to changes in a project?

1. Overhead and profit

2. Allocated expenses

3. Budget variance

4. Change orders

The correct answer is: Overhead and profit

The correct answer is a reflection of the additional expenses incurred as a result of modifications made to a project. Changes in project scope, timeline, or resources often lead to adjustments in costs, which can surface as overhead and profit. Overhead refers to the indirect costs associated with running a project, such as administrative expenses, utilities, and rent. Profit is the financial gain expected from the project after covering all expenses. While change orders do account for proposed alterations in work scope and the associated costs, they specifically refer to documented requests to change the initial project agreement, thus potentially leading to resultant overhead and profit changes. Budget variance, on the other hand, describes the difference between the planned budget and the actual expenditure but does not specifically indicate the cause for the change. Allocated expenses relate to how costs are distributed across different components of the project but do not directly address the consequences of changes in a project. Therefore, the significance of the resultant costs from project changes directly ties back to overhead and profit, illustrating how these factors are influenced by project modifications.