Two types of change order pricing include which pairing?

Two types of change order pricing include which pairing?

• A. Forward Pricing, Post pricing
• B. Forward Pricing, Backward pricing
• C. Initial Pricing, Post pricing
• D. Initial Pricing, Backward pricing

Answer: (A)

Pricing change orders can be handled in two main ways depending on when the price is established. Forward pricing requires the contractor to present a price before the change work begins, based on estimated quantities, labor, materials, and an approved overhead and profit. This helps the owner budget and get timely approval, but it relies on the accuracy of the estimates and pre-negotiated contingencies to manage risk. Post pricing bases the change price on actual costs incurred after the work is completed, with any agreed-upon adjustments for overhead and profit. This is useful when the scope is uncertain or the work can’t be priced precisely upfront, and it protects the contractor from underestimating costs while shifting more cost risk to the owner if actual expenses rise. These two pairings—forward pricing and post pricing—cover the standard timing options for pricing change orders, which is why they are the correct pairing.

Pricing change orders can be handled in two main ways depending on when the price is established. Forward pricing requires the contractor to present a price before the change work begins, based on estimated quantities, labor, materials, and an approved overhead and profit. This helps the owner budget and get timely approval, but it relies on the accuracy of the estimates and pre-negotiated contingencies to manage risk. Post pricing bases the change price on actual costs incurred after the work is completed, with any agreed-upon adjustments for overhead and profit. This is useful when the scope is uncertain or the work can’t be priced precisely upfront, and it protects the contractor from underestimating costs while shifting more cost risk to the owner if actual expenses rise. These two pairings—forward pricing and post pricing—cover the standard timing options for pricing change orders, which is why they are the correct pairing.