Terminology - M
Machine Hour Rate
An actual or predetermined cost apportionment or overhead absorption which is calculated by dividing the expense to be apportioned or absorbed by the number of hours for which process equipment is operated or expected to be operated. (ACE)
Machine Time Record
A document which records, inter alia, the amount of time an item of equipment is operated or remains idle and the work done by the machine and which may record the cost of the time so recorded. (ACE)
MADAP (Manpower Distribution Analysis Program)
A computerised method for calculating manpower requirements, saturation, supervision and progress taking into consideration weather and other variables. Productivity is also measured by comparing paid man-hours against earned" budgeted units. (Fluor)
Main Contractor
A person or firm employed by a purchaser to execute work or service who is also responsible for any work carried out by sub-contractors. (ACE)
Main Plant Items
The major items of ON-SITE plant, i.e. the vessels, machines, mechanical handling equipment and electrical motors, including installed spares. (ACE)
Maintenance
The expense, both for labour and materials, required to keep equipment or other installations in suitably operable conditions. Maintenance does not usually include those items which cannot be used up within the year of purchase. These must be considered as fixed capital. Special maintenance may include the expenditure of an exceptional and infrequent nature on (1) altering, modernising or repositioning buildings and plant, or (2) renewing part of a unit of property or plant. (ACE)
or
The expense, both for labour and materials, required to keep equipment or other installations in suitably operable condition. Maintenance does not usually include those items which cannot be expended within the year purchased that must be considered fixed capital. (FLUOR)
Maintenance Cost
The expense of maintaining fixed assets in running order. (ICWA)
Maintenance Facilities
The tools, equipment, consumable goods and non-productive labour required for the purpose of ensuring that productive plant is in a state of efficient operation (ACE)
Major Equipment (4000 a/c items)
The machinery and equipment installed to do a specific process function. Included are pumps, compressors, exchangers, vessels, etc. (FLUOR)
Make vs. Buy
The option which faces many manufacturing organisations of purchasing the raw materials they use as compared to investing in facilities to manufacture the raw materials themselves. (ACE)
Man-hour
Base unit of work measurement. (ACE)
or
Is defined as one man working for one clock hour irrespective of his status, discipline or colour. (EMS)
Man-hour Budget
Man-hour target for completion. (ACE)
Man-hour Change
Any change to previously established MAN-HOUR BUDGET. (ACE)
Man-hour Cost
Actual or estimated cost of MAN-HOURS EXPENDED. (ACE)
Man-hour Estimate
Estimate of man-hours required. (ACE)
Man-hour Forecast
Forecast of final man-hours to be expended. (ACE)
Man-hour Norm
Established standard man-hour expenditure for specific task or unit of work. (ACE)
Man-hour Rate
1. Cost per man-hour
2. Man-hours per work unit. (ACE)
Man-hours Expended
Man-hours used to date. (ACE)
Man-hours To Complete
Estimate or forecast of man-hours to be expended from to-date until completion. (ACE)
Management Level Schedule
The least level of detail. (FLUOR)
Managing Contractor
Prime contractor responsible to client for overall management of project. (ACE)
Manpower
Manning levels in respect of specified tasks. (ACE)
Manpower Histogram
Vertical bar chart indicating estimated or actual manpower over time. (ACE)
Manpower Loading
Manpower resource of bar charts, schedules or networks, in terms of man-hours, man days, man weeks, etc. (ACE)
Manpower Resource Schedule
Project schedule resource to show anticipated manpower loading. (ACE)
Manufacturing Cost
1. The total expense of converting raw materials to finished products. It therefore includes all materials, labour and factory overheads, incurred in the making of a product, up to and including packaging, but it excludes distribution and selling expenses.
2. In the process industries, the total operating expenditure in making a given product, expressed as annual cost, or money per unit of production. It includes direct expenses such as ingredients, labour, utilities and also fixed or allocated charges as maintenance, plant depreciation (non-cash expenses), insurance and property taxes. Overheads within the plant are normally included but sales, administration, research, development and freight are not usually included.
3. In the chemical industry, the expenditure chargeable in the making of a given product, including raw material, processing, technical service, laboratory, operating labour, utilities, catalysts and chemicals, packages, maintenance, plant depreciation, insurance and property taxes. Normally excludes administration, selling and research expense.
4. FACTORY COST, MILL COST and EX-WORKS COST are in some industries synonymous with MANUFACTURING COST. (ACE)
or
The total of operating costs chargeable to productions of a given product usually expressed in cents or dollars per unit of production. Includes direct expenses such as ingredients, labour, utilities, and also such fixed or allocated charges as maintenance, depreciation (a non-cash expense), insurance and property taxes. Overheads within the plant are usually considered within manufacturing costs: sales, administrative and research overheads, and freight are usually not included.
(FLUOR)
Manufacturing Cost Variance
The difference between standard expenditure and actual expenditure on inventories and finished products. The appropriate title under which these are entered a PROFIT AND LOSS account. (ACE)
Mapi Method
American system of analysis based on the discounted cash flow procedure. (ACE)
or
An American system of analysis based fundamentally on the discounted cash flow procedure. By formula approach, it compares making an investment now with going on without investing for one more year. Easy to apply but should not be used where assumptions built into the formula do not fit a particular situation. (ACE)
or
A system of analysis based fundamentally on the discounted cash flow procedure. By formula approach it compares making an investment now with going on without investing for one more year. Easy to apply but should not be used where the assumptions built into the formula do not fit a particular situation. (FLUOR)
Margin
Any specified differential, such as between cost and revenue. (ACE)
Marginal Cost
1. Prime expenditure plus variable overhead expenses (i.e. excluding fixed costs).
2. The added or incremental costs of making one additional unit of product without additional investment in facilities. (ACE)
Marginal Costing
The ascertainment, by differentiating between fixed and variable expenditure, of prime expenditure plus variable overhead expense and of the effect on profit of changes in volume or type of output. (ICWA)
Mark-up
Add-on applied to actual costs or contract rates in order to provide reimbursement for overhead and/or profit. (ACE)
Market Cost Rate
Expenditure apportionment which is at the current market rate for a comparable service. (ACE)
Master Budget
Any high level summary budget. (ACE)
or
Summarised plan incorporating its component functional forecasts which is finally approved, adopted and employed. (ICWA)
Master Schedule
Any high level summary schedule. (ACE)
or
A BAR CHARTS SCHEDULE prepared early in the project establishing major requirements for engineering activities, procurement, and construction. (FLUOR)
Material Control
Process of controlling the sequence of material procurement activities from requisition to final delivery at point of installation. (ACE)
or
Incorporates the procedures of purchasing, receiving, storing and issuing commodities with the object of ensuring adequate supplies and the prevention of overstocking, misappropriation and waste. (ACE)
Material Cost
The expenditure on commodities to an undertaking. (ACE)
or
The cost of everything of a substantial nature that is essential to the construction or operation of a facility, both of a direct or indirect nature. Generally includes all manufactured equipment as a basic part. (FLUOR)
Material Cost Control
Process of controlling the cost of purchased material, from initial estimate to final invoice. (ACE)
Material Cost Percentage Rate
An actual or predetermined rate of expense apportionment or overhead absorption which is calculated by dividing the expenditure to be apportioned or absorbed by the material expenditure incurred or expected to be incurred and expressing the result as a percentage. (ACE)
Material Cost Variance
The difference between the standard expenditure on commodities specified and the expenditure on those actually used. (ACE)
Material Handling Cost
Any cost or charge arising from the loading, unloading, transporting, storing, etc., of purchased material. (ACE)
or
The expenditure in storing and moving commodities, goods or merchandise within an undertaking. (ACE)
Material Issue Analysis
An analysis of goods, commodities or merchandise issued for a given purpose, classified or coded. (ACE)
Material Mixture Variance
That portion of the ingredients usage, which is due to the difference between the standard and the actual composition of a mixture. (ACE)
Material On Site
Is defined as the cost of any, equipment or material which has been ordered and delivered to site for incorporation into the project, usually as a BULK PURCHASE, and which has not been used, installed or allocated to a specific cost code. (EMS)
Material Price Variance
The portion of the commodity cost which is due to the difference between the standard value specified and the actual amount paid. (ACE)
Material Take-off (MTO)
Process of measuring material quantities from drawings. (ACE)
Material Unit Cost
Cost of purchased material expressed in the terms of a standard unit of measurement. (ACE)
Material Usage Variance
The portion of the cost of commodities which is due to the difference between the standard quantity specified and the actual quantity, used. (ACE)
Material Variance
The difference between standard costs and actual costs. The sub-division under which these are entered into the PROFIT and LOSS adjustment accounts. (ACE)
Mathematical Model
1. Same as DETERMINISTlC MODEL.
2. An explicit expression of a model in mathematical form with all probabilistic elements either removed or replaced by expected value elements. (FLUOR)
Maximum Out-Of-Pocket Cash
The highest year-end negative cash balance during project life. (ACE)
Maximum-Out-Of-Pocket Cash
The highest year end negative cash balance during project life. (FLUOR)
Measured Work
Construction or fabrication work which is identified and measured, either physically or from drawings, for Tender, progress or payment purposes. (ACE)
Measured Work
Time for a cycle of operations. (ACE)
Mechanical Completion
Recognised milestone for the completion of a process plant project, from which point commissioning can commence. (ACE)
or
Unit is essentially complete for start-up operation and/or test run. All major work completed except installation of catalyst. Minor work not interfering with operation may not be completed. Acceptance letter will have been submitted to the client. (FLUOR)
Mechanical Equipment Usage
The temporary employment during construction of power operated items, such as cranes, excavators, bulldozers, concrete mixers, pumps, hydraulic lifts, tractors, hauliers, welding sets, dumpier, chaseside shovels, rollers, lorries and personnel transport measured in hours. Cost of usage will include cost of hire of such equipment when applicable. (ACE)
Merge Event
An event into which two or more activities flow. Contrast with BURST EVENT. (FLUOR)
Method Statement
Statement in construction contract indicating general method of working. (ACE)
Methods Variance
The portion of the total cost variance which is due to the use of methods other than those specified. (ICWA)
Milestone
Principal or critical event or occurrence within a project programme. (ACE)
or
An event selected for its importance. (FLUOR)
Milestone Network
A network consisting of milestones and special events. See SUMMARY NETWORK. (FLUOR)
Milestone Plan
A time phased plan containing the directed occurrence dates for those key events designated as milestones. (FLUOR)
Milestone Scheduling
A variation of Gantt or bar chart scheduling which shows major milestones for engineering procurement and construction activities. This serves as the Master Plan for the Overall Project. (FLUOR)
Mill Cost
The total expense of converting raw materials to finished products ready for delivery but excluding selling and distribution expenses. (ACE)
Minimum Unit Cost
A measure of the operating level of an existing facility which produces the lowest average manufacturing expense per component of output. (ACE)
Mixed Ton
Measure of several products in mixed form. (ACE)
Mobilisation
Term used to describe project or contract preparatory setting-up activity. (ACE)
Modular Co-Ordination
A system of measurement in which all dimensions must be multiples of 4". It permits economy in construction and calculation. (ACE)
Module
It is a PROJECT LEVEL SCHEDULE. It is a network diagram, which depicts a step-by-step plan for performing work by a discipline. It indicates logic, sequence of activities, dependencies and restraints. There are two types of modules. The hand drawn modules and plotter drawn modules. (FLUOR)
Monitoring
See COST MONITORING. (ACE)
Monte Carlo Simulation
Particular method of computerised probabilistic determination, commonly utilised in risk analysis procedures. (ACE)
Monte Carlo Technique
1. A technique using probability distribution functions to approximate evaluations of mathematical expressions.
2. A vernacular synonym for simulation of stochastic processes. (FLUOR)
Most Likely Time Estimate (MT)
The most realistic estimate of the time an activity might consume. (FLUOR)
An actual or predetermined cost apportionment or overhead absorption which is calculated by dividing the expense to be apportioned or absorbed by the number of hours for which process equipment is operated or expected to be operated. (ACE)
Machine Time Record
A document which records, inter alia, the amount of time an item of equipment is operated or remains idle and the work done by the machine and which may record the cost of the time so recorded. (ACE)
MADAP (Manpower Distribution Analysis Program)
A computerised method for calculating manpower requirements, saturation, supervision and progress taking into consideration weather and other variables. Productivity is also measured by comparing paid man-hours against earned" budgeted units. (Fluor)
Main Contractor
A person or firm employed by a purchaser to execute work or service who is also responsible for any work carried out by sub-contractors. (ACE)
Main Plant Items
The major items of ON-SITE plant, i.e. the vessels, machines, mechanical handling equipment and electrical motors, including installed spares. (ACE)
Maintenance
The expense, both for labour and materials, required to keep equipment or other installations in suitably operable conditions. Maintenance does not usually include those items which cannot be used up within the year of purchase. These must be considered as fixed capital. Special maintenance may include the expenditure of an exceptional and infrequent nature on (1) altering, modernising or repositioning buildings and plant, or (2) renewing part of a unit of property or plant. (ACE)
or
The expense, both for labour and materials, required to keep equipment or other installations in suitably operable condition. Maintenance does not usually include those items which cannot be expended within the year purchased that must be considered fixed capital. (FLUOR)
Maintenance Cost
The expense of maintaining fixed assets in running order. (ICWA)
Maintenance Facilities
The tools, equipment, consumable goods and non-productive labour required for the purpose of ensuring that productive plant is in a state of efficient operation (ACE)
Major Equipment (4000 a/c items)
The machinery and equipment installed to do a specific process function. Included are pumps, compressors, exchangers, vessels, etc. (FLUOR)
Make vs. Buy
The option which faces many manufacturing organisations of purchasing the raw materials they use as compared to investing in facilities to manufacture the raw materials themselves. (ACE)
Man-hour
Base unit of work measurement. (ACE)
or
Is defined as one man working for one clock hour irrespective of his status, discipline or colour. (EMS)
Man-hour Budget
Man-hour target for completion. (ACE)
Man-hour Change
Any change to previously established MAN-HOUR BUDGET. (ACE)
Man-hour Cost
Actual or estimated cost of MAN-HOURS EXPENDED. (ACE)
Man-hour Estimate
Estimate of man-hours required. (ACE)
Man-hour Forecast
Forecast of final man-hours to be expended. (ACE)
Man-hour Norm
Established standard man-hour expenditure for specific task or unit of work. (ACE)
Man-hour Rate
1. Cost per man-hour
2. Man-hours per work unit. (ACE)
Man-hours Expended
Man-hours used to date. (ACE)
Man-hours To Complete
Estimate or forecast of man-hours to be expended from to-date until completion. (ACE)
Management Level Schedule
The least level of detail. (FLUOR)
Managing Contractor
Prime contractor responsible to client for overall management of project. (ACE)
Manpower
Manning levels in respect of specified tasks. (ACE)
Manpower Histogram
Vertical bar chart indicating estimated or actual manpower over time. (ACE)
Manpower Loading
Manpower resource of bar charts, schedules or networks, in terms of man-hours, man days, man weeks, etc. (ACE)
Manpower Resource Schedule
Project schedule resource to show anticipated manpower loading. (ACE)
Manufacturing Cost
1. The total expense of converting raw materials to finished products. It therefore includes all materials, labour and factory overheads, incurred in the making of a product, up to and including packaging, but it excludes distribution and selling expenses.
2. In the process industries, the total operating expenditure in making a given product, expressed as annual cost, or money per unit of production. It includes direct expenses such as ingredients, labour, utilities and also fixed or allocated charges as maintenance, plant depreciation (non-cash expenses), insurance and property taxes. Overheads within the plant are normally included but sales, administration, research, development and freight are not usually included.
3. In the chemical industry, the expenditure chargeable in the making of a given product, including raw material, processing, technical service, laboratory, operating labour, utilities, catalysts and chemicals, packages, maintenance, plant depreciation, insurance and property taxes. Normally excludes administration, selling and research expense.
4. FACTORY COST, MILL COST and EX-WORKS COST are in some industries synonymous with MANUFACTURING COST. (ACE)
or
The total of operating costs chargeable to productions of a given product usually expressed in cents or dollars per unit of production. Includes direct expenses such as ingredients, labour, utilities, and also such fixed or allocated charges as maintenance, depreciation (a non-cash expense), insurance and property taxes. Overheads within the plant are usually considered within manufacturing costs: sales, administrative and research overheads, and freight are usually not included.
(FLUOR)
Manufacturing Cost Variance
The difference between standard expenditure and actual expenditure on inventories and finished products. The appropriate title under which these are entered a PROFIT AND LOSS account. (ACE)
Mapi Method
American system of analysis based on the discounted cash flow procedure. (ACE)
or
An American system of analysis based fundamentally on the discounted cash flow procedure. By formula approach, it compares making an investment now with going on without investing for one more year. Easy to apply but should not be used where assumptions built into the formula do not fit a particular situation. (ACE)
or
A system of analysis based fundamentally on the discounted cash flow procedure. By formula approach it compares making an investment now with going on without investing for one more year. Easy to apply but should not be used where the assumptions built into the formula do not fit a particular situation. (FLUOR)
Margin
Any specified differential, such as between cost and revenue. (ACE)
Marginal Cost
1. Prime expenditure plus variable overhead expenses (i.e. excluding fixed costs).
2. The added or incremental costs of making one additional unit of product without additional investment in facilities. (ACE)
Marginal Costing
The ascertainment, by differentiating between fixed and variable expenditure, of prime expenditure plus variable overhead expense and of the effect on profit of changes in volume or type of output. (ICWA)
Mark-up
Add-on applied to actual costs or contract rates in order to provide reimbursement for overhead and/or profit. (ACE)
Market Cost Rate
Expenditure apportionment which is at the current market rate for a comparable service. (ACE)
Master Budget
Any high level summary budget. (ACE)
or
Summarised plan incorporating its component functional forecasts which is finally approved, adopted and employed. (ICWA)
Master Schedule
Any high level summary schedule. (ACE)
or
A BAR CHARTS SCHEDULE prepared early in the project establishing major requirements for engineering activities, procurement, and construction. (FLUOR)
Material Control
Process of controlling the sequence of material procurement activities from requisition to final delivery at point of installation. (ACE)
or
Incorporates the procedures of purchasing, receiving, storing and issuing commodities with the object of ensuring adequate supplies and the prevention of overstocking, misappropriation and waste. (ACE)
Material Cost
The expenditure on commodities to an undertaking. (ACE)
or
The cost of everything of a substantial nature that is essential to the construction or operation of a facility, both of a direct or indirect nature. Generally includes all manufactured equipment as a basic part. (FLUOR)
Material Cost Control
Process of controlling the cost of purchased material, from initial estimate to final invoice. (ACE)
Material Cost Percentage Rate
An actual or predetermined rate of expense apportionment or overhead absorption which is calculated by dividing the expenditure to be apportioned or absorbed by the material expenditure incurred or expected to be incurred and expressing the result as a percentage. (ACE)
Material Cost Variance
The difference between the standard expenditure on commodities specified and the expenditure on those actually used. (ACE)
Material Handling Cost
Any cost or charge arising from the loading, unloading, transporting, storing, etc., of purchased material. (ACE)
or
The expenditure in storing and moving commodities, goods or merchandise within an undertaking. (ACE)
Material Issue Analysis
An analysis of goods, commodities or merchandise issued for a given purpose, classified or coded. (ACE)
Material Mixture Variance
That portion of the ingredients usage, which is due to the difference between the standard and the actual composition of a mixture. (ACE)
Material On Site
Is defined as the cost of any, equipment or material which has been ordered and delivered to site for incorporation into the project, usually as a BULK PURCHASE, and which has not been used, installed or allocated to a specific cost code. (EMS)
Material Price Variance
The portion of the commodity cost which is due to the difference between the standard value specified and the actual amount paid. (ACE)
Material Take-off (MTO)
Process of measuring material quantities from drawings. (ACE)
Material Unit Cost
Cost of purchased material expressed in the terms of a standard unit of measurement. (ACE)
Material Usage Variance
The portion of the cost of commodities which is due to the difference between the standard quantity specified and the actual quantity, used. (ACE)
Material Variance
The difference between standard costs and actual costs. The sub-division under which these are entered into the PROFIT and LOSS adjustment accounts. (ACE)
Mathematical Model
1. Same as DETERMINISTlC MODEL.
2. An explicit expression of a model in mathematical form with all probabilistic elements either removed or replaced by expected value elements. (FLUOR)
Maximum Out-Of-Pocket Cash
The highest year-end negative cash balance during project life. (ACE)
Maximum-Out-Of-Pocket Cash
The highest year end negative cash balance during project life. (FLUOR)
Measured Work
Construction or fabrication work which is identified and measured, either physically or from drawings, for Tender, progress or payment purposes. (ACE)
Measured Work
Time for a cycle of operations. (ACE)
Mechanical Completion
Recognised milestone for the completion of a process plant project, from which point commissioning can commence. (ACE)
or
Unit is essentially complete for start-up operation and/or test run. All major work completed except installation of catalyst. Minor work not interfering with operation may not be completed. Acceptance letter will have been submitted to the client. (FLUOR)
Mechanical Equipment Usage
The temporary employment during construction of power operated items, such as cranes, excavators, bulldozers, concrete mixers, pumps, hydraulic lifts, tractors, hauliers, welding sets, dumpier, chaseside shovels, rollers, lorries and personnel transport measured in hours. Cost of usage will include cost of hire of such equipment when applicable. (ACE)
Merge Event
An event into which two or more activities flow. Contrast with BURST EVENT. (FLUOR)
Method Statement
Statement in construction contract indicating general method of working. (ACE)
Methods Variance
The portion of the total cost variance which is due to the use of methods other than those specified. (ICWA)
Milestone
Principal or critical event or occurrence within a project programme. (ACE)
or
An event selected for its importance. (FLUOR)
Milestone Network
A network consisting of milestones and special events. See SUMMARY NETWORK. (FLUOR)
Milestone Plan
A time phased plan containing the directed occurrence dates for those key events designated as milestones. (FLUOR)
Milestone Scheduling
A variation of Gantt or bar chart scheduling which shows major milestones for engineering procurement and construction activities. This serves as the Master Plan for the Overall Project. (FLUOR)
Mill Cost
The total expense of converting raw materials to finished products ready for delivery but excluding selling and distribution expenses. (ACE)
Minimum Unit Cost
A measure of the operating level of an existing facility which produces the lowest average manufacturing expense per component of output. (ACE)
Mixed Ton
Measure of several products in mixed form. (ACE)
Mobilisation
Term used to describe project or contract preparatory setting-up activity. (ACE)
Modular Co-Ordination
A system of measurement in which all dimensions must be multiples of 4". It permits economy in construction and calculation. (ACE)
Module
It is a PROJECT LEVEL SCHEDULE. It is a network diagram, which depicts a step-by-step plan for performing work by a discipline. It indicates logic, sequence of activities, dependencies and restraints. There are two types of modules. The hand drawn modules and plotter drawn modules. (FLUOR)
Monitoring
See COST MONITORING. (ACE)
Monte Carlo Simulation
Particular method of computerised probabilistic determination, commonly utilised in risk analysis procedures. (ACE)
Monte Carlo Technique
1. A technique using probability distribution functions to approximate evaluations of mathematical expressions.
2. A vernacular synonym for simulation of stochastic processes. (FLUOR)
Most Likely Time Estimate (MT)
The most realistic estimate of the time an activity might consume. (FLUOR)
