Which of the following costs are typically classified as overhead in construction estimation?

Overhead costs in construction estimation refer to expenses that are not directly attributable to a specific project or task but are necessary for the overall operation of the business. These costs support the entire operation rather than just one particular project. Administrative salaries and utilities fall into this category because they encompass the ongoing expenses required to keep the business running, including the salaries of administrative personnel, office supplies, and utility bills.

In contrast, materials and labor are classified as direct costs since they are specifically incurred to complete a project. Tools and equipment, while important for project execution, are also considered direct costs if they are associated specifically with a job or may be classified as capital expenditures if they involve significant investment. Contractor bids and insurance premiums, while important for project cost management, do not contribute directly to construction work and are usually reflected in overhead costs related to project administration and risk management.

Understanding the classification of these costs is crucial for accurate budgeting and financial planning in construction projects.