CHAPTER 1: The Profession
Key Terms
Associations
Vignette
Society decorator
Ensembliers
Ateliers
Residential interior design
Commercial interior design
CEUs
Practice acts
Title acts
Certification
NCIDQ examination
STEP program
American Institute of Interior Decorators (AIID)
American Institute of Decorators (AID)
American Institute of Interior Designers (AID)
National Society for Interior Designers (NSID)
American Society of Interior Designers (ASID)
National Office Products Association (NOPA)
Institute of Business Designers (IBD)
International Society of Interior Designers
(ISID)
International Interior Design Association (IIDA)
National Council for Interior Design
Qualification (NCIDQ)
Interior Design Educators Council (IDEC)
Foundation for Interior Design Education
and Research (FIDER)
Interior Designs of Canada (IDC)
Names
Elsie deWolfe
Dorothy Draper
William R. Moore
Quickborner Team
Charles Gelber
Discussion Items
•
What are the characteristics of a profession? Explain how these apply to the interior design
profession.
•
How might you use these characteristics to explain how the professional interior designer
differs from the "decorator"?
•
Explain how the work of Elsie deWolfe impacted the profession of interior design.
•
What influenced the development of the first national interior design professional
association?
•
What issues influenced the changes in the interior design associations over the years? Do
these challenges continue in practice today ?
•
Define the acronyms: AIID, NSID, NOPA-d, and explain their role in the development of
the interior design profession.
1
•
Explain the responsibility of FIDER and IDEC. How do these organizations assist in the
ongoing development of the interior design profession?
•
How do the educational standards established by FIDER benefit the profession?
•
What are the requirements for entry-level membership in ASID, IIDA, or any other
applicable professional association in your area?
•
What are the benefits of becoming affiliated and actively involved in one of the interior
design professional associations?
•
How do the other membership categories of the associations interact and compliment the
professional and allied/associate levels?
•
Why is it beneficial to students to interact with interior design professionals?
•
Which organizations participated in the Unification Task Force? What were the goals of the
unification process?
•
What might be the pros and cons of one unified organization for interior designers in the
future?
•
Explain the purpose and responsibility of NCIDQ.
•
Discuss why it is important for interior designers to take the NCIDQ examination.
•
Define the current requirements to take the NCIDQ examination. Briefly explain the three
parts of the examination.
•
What is the difference between interior design practice acts and title acts?
•
Discuss why the licensing of interior designers is important to the designer's right to practice.
•
What is "reciprocity" and what affect does it have on the practice of licensed interior
designers? Does your jurisdiction allow reciprocity?
•
What state in the United States was first to pass licensing legislation?
•
If your jurisdiction has interior design licensing legislation, discuss how this affects practice.
If it does not, invite professional interior designers to speak to the class about the pros and
cons of licensing in your jurisdiction.
•
Why is it important for interior designers to continue their education through seminars and
workshops?
Sample Questions
2
Multiple Choice
1. Which statement does NOT refer to a characteristic of a true profession?
A. A code of conduct to ensure professional integrity.
B. The competence of professionals ensured by examination.
C. The necessity of at least a bachelors degree.
D. A professional association that organizes members.
2. A term often associated with those who were involved in the earliest decoration of
interiors.
A. Ateliers.
B. Shopkeepers.
C. Society decorators.
D. Artisans.
3. According to the text, who is credited with helping establish professionalism in interior
design/decoration in the early part of the 20th century?
A. Frank Lloyd Wright.
B. William Morris.
C. Elsie deWolfe.
D. Dorothy Draper.
4. What year was the first national interior decoration/design association founded?
A. 1878.
B. 1909.
C. 1931.
D. 1975.
5. This organization was the very first national professional association related to the
interiors industry.
A. American Decorators Club.
B. American Institute of Interior Decorators.
C. National Society of Interior Designers.
D. American Society of Interior Designers.
6. The organization responsible for administering the primary examination for the interior
design profession.
A. FIDER.
B. NCARB.
C. NCIDQ.
D. IDEC.
7. The accreditation process is managed by this organization.
A. FIDER.
B. NCIDQ.
C. IDEC.
D. ASID.
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8. The minimum differential for all candidates who wish to take the NCIDQ examination.
A. A bachelors degree in interior design.
B. Two years academic training in interior design.
C. Four years of professional work experience in interior design.
D. Six years of professional work experience in interior design.
9. The type of legislation that deals with limiting who may work in the interior industry.
A. Practice act legislation.
B. Codes of conduct.
C. Title act legislation.
D. National certification legislation.
10. The criteria mandatory for professional level membership in ASID, IIDA, and IDC.
A. Pass the NCIDQ examination.
B. 10 hours of CEU classes each year.
C. A minimum of four years full-time work experience.
D. A minimum of two years full-time work experience.
True–False
1. Practice acts only determine who can use the term "interior designer."
2. One hour of CEU credit is equivalent to one semester hour of class in a community college.
3. The first state to pass any kind of interior design licensing legislation was Alabama.
4. If you fail a part of the NCIDQ, you must take ALL of the exam over again.
5. The first independent professional association for commercial interior designers was the
Institute of Business Designers.
4
CHAPTER 2: Ethics
Key Terms
Conflict of interest
Fiduciary duties
Proprietary information
Ethical standards
Codes of conduct
Discussion Items
•
Why is ethical behavior within the interior design profession important whether or not a
professional is involved in an association?
•
According to the text, what are the four key ethical decisions that are commonly manifested
in the general business environment?
5
•
What is the purpose of ethical standards and codes of conduct in interior design?
•
What would you do if a manufacturer told you he would provide you with an extra discount
that no other bidders would receive?
•
Give an example of a conflict of interest between you and your client. Are there other
professional relationships or responsibilities that can result in a conflict of interest
situation?
•
If you have propriety information about a client, is it permissible to use that information in a
marketing presentation to obtain work from that client's competitor?
•
What action should you take if you found out that a colleague in your office was using
software owned by the design firm for design projects the colleague was doing on her own
time–not through the office.
•
According to the text, people behave unethically primarily for three specific reasons. Name
these and discuss how these basic behaviors can negatively impact your dealings with clients.
•
Is it ethical for the owner of a design firm to indicate to a client that the plans prepared by
an employee are, in fact, those of the owner?
Sample Questions
Multiple Choice
1. This action is considered unethical practice.
A. Not faithfully fulfilling all portions of a design contract.
B. Asking a client to not sign a contract with your present employer because you are
about to open your own firm.
C. Telling a client confidential information about another client.
D. All of the above are examples of unethical practice.
2. Mr. Jones, while in the process of discussing a project with his client Mr. Brown, reveals to
Brown confidential information about the business practices of Brown's prime competitor.
This action would be considered
A. A good way to keep clients happy.
B. Unethical and disloyal to the first client.
C. Breach of negligence with the client.
D. Strict liability.
3. Which is an example of conflict of interests?
A. Purchasing goods for your client from only one vendor.
B. A designer using the same accountant as another interior designer.
C. An association chapter board member entering a design competition that he or she
will be judging.
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D. An association chapter officer who uses information learned about vendors at the
board meeting for her own firm.
4. Assuming only one of these parties has signed a contract with the client, which individual
owes the highest level of fiduciary duty to a client?
A. The interior designer.
B. A contractor.
C. A wall paper hanger.
D. The furniture manufacturer.
5. According to the text, this is the MAIN reason people behave unethically.
A. They may see no harm in their behavior.
B. They need to sell the job.
C. Their boss has pressured them to do so.
D. All of the above.
True–False
1. Mr. Smith paid for his new desk in full but the designer will not deliver the desk until Smith
signs a new design agreement for additional work. Is this ethical behavior by the designer?
2. Ethical complaints can be made against designers who are unaffiliated with one of the
interior design professional associations.
3. A disciplinary hearing by a professional association in interior design is the same thing as
a court hearing.
4. Putting personal gain above the interests of the client is ethical since you are a business
person.
CHAPTER 3: Personal Goal Setting
Key Terms
Goals
7
Personal goals
Professional goals
Personal mission statement
Discussion Items
•
Discuss why successful professionals develop and work to achieve goals rather than waiting
for positive things to happen.
•
Explain the difference between dreams and goals.
•
Why is it difficult for people to set personal and professional goals?
•
Why it is useful and important for students to begin looking at long range career goals?
•
What should you do if you do not achieve a goal?
•
What do you think Steven Covey meant by "Begin with the end in mind"?
Sample Questions
Multiple Choice
1. The MOST common reason people have a hard time setting goals.
A. It requires making a commitment.
B. Goals are really dreams and dreams never come true.
C. Not accomplishing a goal always leads to feelings of failure.
D. It is hard to know what you want ten years into the future.
2. A personal mission statement can
A. Help you clarify your values and your philosophy.
B. Define your goals for the next year.
C. Help you handle the challenges that affect your life.
D. All of the above.
3. Which is an example of a well-written goal?
A. Make more money.
B. Increase my income by 10 percent each year.
C. Buy a new car.
D. Achieve success in interior design profession.
True–False
1. The most successful professionals are those who have a clear vision of what their life will be
like in the future as well as the present.
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2. Once you set a goal, you should never change it.
CHAPTER 4: Planning a New Interior Design Practice
Key Terms
Entrepreneur
Business plan
Mission statement
Pro forma
Discussion Items
•
Describe the common characteristics of an entrepreneur.
•
Why do you think entrepreneurial businesses are the leading type of business created today?
•
Name and discuss at least three advantages and disadvantages of business ownership.
•
Why is it important for the business owner and employees to understand the mission of the
business?
•
What is the purpose and use of a business plan?
•
Discuss at least two of the factors that should be analyzed before writing a business plan.
•
How can owners use pro forma income statements when preparing a business plan for a new
venture?
Sample Questions
Multiple Choice
1. Ann Baxter has been in the interior design profession for five years. She has owned a
business with a partner for one of those five years. Her partner suggested they write a
plan for the coming year. In this case, what is the MAIN purpose of a business plan for
Baxter and her partner?
A. Define annual goals of an existing business.
B. Define the idea and operation of a new business venture.
C. Define marketing goals of a new business venture.
D. Define pricing policies for the selling of goods.
2. What is the LEAST important section to include in the business plan for a new interior
design practice that will offer services and sell products to clients?
A. Market research including research on competition.
B. Financial planning showing projected revenues and expenses for at least one year.
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C. A discussion of employee benefits and compensation.
D. A business summary that clarifies the overall goals and purposes of the business
including the kinds of services to be provided.
3. This disadvantage would be the MOST troublesome to the single practitioner entrepreneur.
A. Long hours.
B. Absolute legal liability.
C. Loneliness.
D. Greater responsibility.
4. Sally Jones is planning to start her own hospitality design practice. She will need funds to
purchase a variety of operational equipment. In order to obtain financing, what is the MOST
important information that she will have to prepare?
A. Pro forma income statement.
B. Marketing plan.
C. Personal resume and client list.
D. Competition analysis.
5. The purpose of a business plan is to define
A. The idea and operations of a new business venture.
B. Annual goals of an existing business.
C. The marketing goals of a new business venture.
D. Pricing policies for the selling of goods.
6. Which factor is LEAST important in deciding to start one's own design practice?
A. Personal motivation.
B. Financial risk.
C. Design skills.
D. Location.
7. The MOST important consideration in developing a company mission statement.
A. Stating the firm's direction and purpose.
B. Explaining where the firm will be located.
C. Mentioning the names of the owners.
D. The owner's design philosophy.
True–False
1. An entrepreneur is a business owner that always tries to do something differently.
2. The lack of a business plan is a primary reason for the failure of a new business.
3. "ABC Interior Design, Inc. provides interior design services" is an appropriately stated
mission statement.
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4. The income statement generally created when developing a business plan for a new
business is called a pro forma income statement.
CHAPTER 5: Advice and Counsel
Key Terms
Profit and loss statement
Operating funds
Debt capital
Equity capital
Lines of credit
US Small Business Administration (SBA)
Professional liability insurance
Errors and omissions coverage (E&O)
Property damage insurance
Unsecured loans
Secured loans
Dun and Bradstreet (D & B)
Trade credit
Allied Board of Trade
Liability insurance
Personal injury insurance
Business income insurance
Pro forma credit
Discussion Items
•
When should you retain an attorney as you plan, and subsequently, operate your design
business?
•
In what ways can an accountant help a business owner?
•
In what ways does a banker help a business owner?
•
How are operating funds different from a firm's profits?
•
What is the difference between debt capital and equity capital?
•
What information would a creditor want to have before loaning money to a design
business?
11
•
What are the differences between long-term and short-term loans?
•
Do suppliers allow all designers to purchase on credit? Explain.
•
What is meant by pro forma credit?
•
Explain the role of Dun and Bradstreet and the Allied Board of Trade.
•
Which type of insurance would protect the designer when he or she incorrectly draws or
incorrectly notes the dimensions for custom cabinets?
•
Define professional liability insurance. How does it protect the designer?
•
What is errors and omissions coverage?
•
Explain what is covered by property damage, liability and personal injury insurance.
•
How do technical consultants assist the interior design profession? Specifically, how do
architects, and contractors help the average non-specialized interior design practice?
•
Discuss ways in which the designer can locate, research and make determinations as to which
professional consultants to use.
•
How can the US Small Business Administration help a design practice?
•
Does the SBA provide direct loans to small businesses?
Sample Questions
Multiple Choice
1. Which advisor would be most helpful to you in checking the credit of potential clients?
A. Accountant.
B. Bankers.
C. Attorney.
D. Insurance agent.
2. Alice Michaels is looking for a loan for operational requirements. She needs $100,000 to
purchase some inventory and the goods for three clients. The type of funds Alice MOST
likely needs.
A. Equity capital.
B. A long term loan.
C. A line of credit.
D. Down payments.
3. Investors provide this type of funding.
A. Equity capital.
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B. A loan.
C. Debt capital.
D. Operating capital.
4. Mary Wilson's home has a market value of $250,000 with only $10,000 left on the mortgage.
She needs $150,000 to lease, furnish, and purchase equipment and supplies to open a small
studio. If Mary is pledging her home in order to get the loan of $150,000, which type of
funding does Mary seek?
A. A secured loan.
B. A line of credit.
C. An equity loan.
D. An unsecured loan.
5. The credit agency that specifically registers interior design firms and suppliers is the
A. Allied Board of Trade.
B. Dun and Bradstreet.
C. Commodities Exchange.
D. Bankers Credit Agency.
6. This insurance protects the designer when mistakes are made on drawings.
A. Personal liability insurance.
B. Errors and liability insurance.
C. Property injury insurance.
D. Errors and omissions insurance.
7. Jon Glenn and his partner, Mark Smith, are looking for insurance to protect them in the event
that their firm is sued by a third party due to negligence or product failure. They will be
purchasing which insurance?
A. General business insurance.
B. Professional liability insurance.
C. Errors and omissions insurance.
D. Property damage insurance.
8. Which type of insurance is mandatory for a design practice with employees?
A. Worker's compensation.
B. Employee health.
C. General liability.
D. Automobile.
9. This consultant is generally required by law to prepare construction drawings for a variety of
commercial businesses.
A. Lighting designer.
B. General contractor.
C. Architect.
D. Plan reviewer.
13
True–False
1. An attorney is the ONLY advisor that can help you determine which type of legal business
formation is appropriate for your situation.
2. When your firm is effectively using a suppliers money instead of yours to initiate the
purchase of goods, you are using "trade credit."
3. The U.S. Small Business Administration provides loans directly to the small business owner.
CHAPTER 6: Business Formations
Key Terms
Sole proprietorship
General partnership
Partnership
Uniform Partnership Act
Limited partnership
Corporation
Incorporate
Incorporation
S corporation
Private corporation
Public corporation
Close corporation
Domestic corporation
Foreign corporation
Articles of Incorporation
Professional corporation
Joint venture
Stakeholders
14
Limited liability company
Discussion Items
•
What are some reasons why a large number of interior design firms start out as sole
proprietorships?
•
Discuss the advantages and disadvantages of a sole proprietorship.
•
Mary Smith is the sole owner of Mary Smith Interiors. She is sued by a client for
negligence. What could the consequences be for Mary if the court finds in the client's
behalf?
•
What is the difference(s) between a general partnership and a limited partnership?
•
Provide three advantages and three disadvantages of a general partnership.
•
How is a general partnership different from a sole proprietorship? What advantages does the
general partnership have over a sole proprietor design firm?
•
Describe what happens if one of the originators of these business formations withdraws
ownership from the business: sole proprietorship, general partnership, corporation, and
limited liability company.
•
Describe the differences in the legal responsibility for the owner of a sole proprietorship,
general partnership, limited liability company, and corporation.
•
What advantages does the corporation form offer to the interior designer who is engaged in
residential design? In commercial design?
•
What are the disadvantages of the corporation for a small interior design practice?
•
What is an S corporation and how is it different from a private corporation?
•
Explain the concept of a professional corporation.
•
What are the advantages and disadvantages of a limited liability company for an interior
design practice?
•
•
What must be done in your jurisdiction to form a limited liability company?
Explain the differences between an LLC and the sole proprietorship, a general partnership,
and a corporation.
•
What is a joint venture? How is it different from a partnership?
•
Explain who the stakeholders would be in the management of a sole proprietorship, general
partnership, limited partnership, and limited liability company.
15
Sample Questions
Multiple Choice
1. The greatest disadvantage of the sole proprietor form of business.
A. High personal legal liability.
B. Requirement to obtain a resale tax license.
C. Neighbors complaining of deliveries to your home.
D. Owner must pay self-employment tax.
2. The profits of which business formation is taxed as personal income?
A. Partnership.
B. Domestic corporation.
C. S corporation.
D. Professional corporation.
3. Alignment Interior Architecture is a corporation. All the stock is owned by the people who
organized and run the business along with their relatives. It only does business in its state of
origin. As defined in the textbook, which type of corporation is Alignment Interior
Architecture?
A. Foreign corporation.
B. Traded corporation.
C. Closely held corporation.
D. Public corporation.
4. Barbara Jones and Lynn Smith own a business called Design Collaborative. Two years later,
Smith decides to pursue a different career. She leaves all activity with the design firm but
retains stock. Jones continues to operate the firm under the original name and without
reorganizing. What form of business is Design collaborative?
A. Joint venture.
B. General partnership.
C. Corporation.
D. Sole proprietorship.
5. Commercial Interiors Inc. and FST Designs have created a firm called AI (Associated
Interiors) to work on a hospital in Southern California. The project will be completed in
three years at which time AI will be disbanded. What kind of business formation is AI?
A. Proprietorship.
B. Joint venture.
C. Private corporation.
D. general partnership.
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6. In which type of business formation are investors referred to as "members?"
A. Limited liability company.
B. Limited partnership.
C. Professional corporation.
D. Privately held corporation.
7. John Jones and Susan Smyth are discussing starting an interior design business. Each will
contribute an equal amount of finances and each will participate in management. Because of
the nature of the design specialty–hospitality and health care interiors–they are particularly
concerned about liability. Which business formation would be MOST appropriate for their
situation?
A. Limited liability company.
B. Proprietorship.
C. Limited partnership.
D. General partnership.
8. If one of the co-owners of this business formation engages in an illegal and wrongful act, the
court will find all the other owners equally as guilty.
A. Corporation.
B. S corporation.
C. Partnership.
D. Proprietorship.
9. Which is FALSE concerning the limited liability company business formation?
A. Personal assets are protected in liability issues.
B. The LLC may hire someone who is not an owner of the company to be the manager.
C. It can have no more than 10 member owners.
D. It will be required to file annual reports and file articles of organization with the state.
10. This term refers to all the individuals who have a personal interest of some kind in a design
project.
A. Design team.
B. Stakeholders.
C. Entrepreneurs.
D. Partnership.
True–False
1. A limited partner has every right to be involved in the management of the design firm.
2. Cardinal Designs was formed as a corporation. If a member of the board of directors resigns,
the corporation must dissolve.
3. The design firm of Weldon, Jones, and Smith has stock traded on the NASDAQ. This is a
characteristic of a closely held corporation.
4. A joint venture is a temporary business formation.
17
5. Al Smith is a limited partner of Wilson, Hunter, and Associates. He has just hired two
designers for the company. This a proper responsibility for Mr. Smith.
6. An S corporation pays taxes on profits as a partnership.
7. Some states will not allow licensed professionals to create a limited liability company.
8. The businesses that create a joint venture continue to exist independently at the same time
the joint venture exists.
18
CHAPTER 7: Legal Filings
Key Terms
Self-employment tax
Personal property tax
Doing business as
Shop right
Worker's compensation insurance
Zoning variance
Zoning restrictions
Intellectual property
Copyright
Patent
Trademark
Publication
Statutory damages
Actual damages
Legal Filings
Employers Identification Number (EIN)
Use Tax Registration Certificate
State Transaction Privilege (sales) Tax License
Doing Business under a Fictitious Name (dba)
Work Authorization Verification
Form W-4 Employee's Withholding Allowance
Certificate
Form W-2 Employer's Wage and Tax
Statement
Form 1099 Information Forms
Organization
Foundation for Design Integrity
Discussion Items
•
When must a business obtain a federal and state EIN?
•
What is self-employment tax? Who has to pay it?
•
Define how a sole-proprietorship pays income taxes.
•
Describe how a general partnership pays income taxes.
•
When is it necessary for a firm to file a DBA statement?
•
What kinds of works are protected by copyright, especially as relates to interior design
practice?
19
•
What three elements are required on a work to give the creator at least minimal protection
under the law for copyright?
•
The designs you create for your employer belong to whom?
•
What type of work produced by an interior designer falls under intellectual property law?
•
How does a designer go about having a work registered with the copyright office?
•
When does copyright "begin"?
•
What does publication as related to copyright mean?
•
As a design employee, if you create a custom furniture design for a client and later a furniture
manufacturer wishes to put the design into its catalog, who owns the rights to the design?
Sample Questions
Multiple Choice
1. This form is required of all businesses that have employees.
A. SS-4 EIN form.
B. 1099K.
C. SET 1040.
D. Schedule EZ EMP.
2. When a firm uses a name other than the names of the owners, what form is generally
required in order to operate?
A. Fictitious business name statement.
B. Transaction sales tax license.
C. Copyright application.
D. Schedule 1099 information form.
3. The form MOST necessary if a firm sells goods to clients.
A. An employers identification number.
B. Transaction privilege (sales) tax license.
C. Employer identification application.
D. Fictitious name form.
4. If Jean Brown sells furniture, finishes, and equipment to her interior design clients, she is
required to:
A. Collect sales tax on products sold through her firm.
B. Collect sales tax on wall coverings sold by the wallpaper hanger.
C. Pay use tax on the labor to complete custom draperies.
D. Obtain a Tangible Property tax license.
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5. This federal tax filing is required of all businesses formed as proprietorships.
A. Copyright registration on its name.
B. W-6 workers compensation reports.
C. Self-employment tax filing.
D. FICA taxes.
6. Mary Ann has been hired to prepare the plans and specifications of a prototype coffee house
project. The client intends to use these plans to build coffee houses in numerous locations
around the country. What is the MOST important notation Mary Ann should affix to the
drawings to protect her design ideas?
A. Her business name.
B. The transaction privilege tax license number.
C. A copyright notification.
D. The date the drawings were completed.
7. The unauthorized use of copyrighted material is
A. OK if you pay the copyright owner.
B. Called infringement.
C. Legal if the material is registered at a library.
D. Called publication.
8. Alan created plans and specifications for a custom table for his client. Alan remembered to
affix a copyright notice to the drawings before giving the drawings to the client or a cabinet
maker. The cabinet maker began making additional versions of the table without permission
of Alan and without making any changes in design. The cabinet maker has
A. Violated a patent.
B. Infringed on the use of the drawings.
C. Did nothing wrong because the drawings were "published".
D. Violated a trademark.
9. Which of the following is NOT required on a creative work for copyright notification?
A. Creator's name.
B. Year of publication.
C. Client's name.
D. Copyright symbol or the word "copyright"
10. This is the length of time a registered copyright exists for the creator/owner of the work.
A. The life of the creator plus 17 years.
B. The life of the creator plus 50 years..
C. The life of the creator plus 70 years.
D. Until the project is completed.
11. Jack has designed a set of graphics for a client of his employer, Martindale Architects and
Interiors, Inc. The contract concerning the design of the graphics involved the use of the
21
graphics for the menu covers only. After opening the restaurant, the client wants to use the
graphics on T-shirts and other souvenirs. In this case, who has ownership rights of the
design?
A. Jack, as he was the creator of the design.
B. The client who hired the design firm to create the design for their sole use.
C. Martindale Architects and Interiors, Inc. as the design was created as part of Jack's
responsibility as an employee.
D. Jack and the client as they collaborated in the creation of the design of the menus.
True–False
1. The only type of business that is required to pay estimated taxes is the sole proprietorship
since the individual is self-employed.
2. Sales tax must be collected from the client whenever goods are sold by the designer.
3. According to the text, an interior designer may be required to have a specialty contractor's
license in order to sell or supervise the installation of architectural finishes.
4. The acronym "DBA" is associated with the strategy of a firm using a name other than that of
its owners to identify the firm.
5. As of 1986, all new employees of a firm must fill out a work authorization verification form.
6. Publication, as related to copyright, begins when the creator somehow distributes the work
to others without restrictions of use.
7. Copyright and patents are part of intellectual property law.
CHAPTER 8: On Your Own
Key Terms
Zoning restrictions
Tenant improvements
Leasehold improvements
Conditions, Covenants, and
Restrictions (CCRs)
Building standard workletter
Inventory
Discussion Items
•
Discuss advantages and disadvantages of working alone.
22
•
What part does self-discipline play in starting one's own design practice?
•
Assign students to investigate zoning restrictions for home businesses in your jurisdiction.
•
What issues need to be negotiated in securing a commercial office space?
•
Invite a real estate agent to speak to the class on the process of negotiating a lease.
•
Discuss the pros and cons of having sellable inventory in the design studio.
• Describe advantages and disadvantages of locating a design practice out of your home; in a
commercial location.
Sample Questions
Multiple Choice
1. These rules and regulations may make it difficult or even impossible to operate your design
business from a home office.
A. Personal property laws.
B. State tax laws.
C. Covenants and restrictions.
D. Tenant laws.
2. When you decide to locate your design business to a commercial location, this document
will outline what the landlord will provide concerning the interior finishing of the office
space.
A. The tenant improvement work plan.
B. The punch list left by the former tenant.
C. The building standard workletter.
D. The building tenant improvement letter.
True–False
1. Discipline is very important in a home office since there is no one to help prevent you from
procrastinating.
2. If you make improvements to the commercial office space you intend to occupy, they are
referred to as tenant improvements.
23
3. If your neighbors complain about traffic to your home office, you may have to relocate your
business to a commercial office.
CHAPTER 9: Business Organization and Management
Key Terms
Chain of command
Autocratic management style
Empowerment
Management
Democratic management style
Functions of management
Discussion Items
• Discuss the similarities between the growth stages of a design firm (shown in Figure 9-2) and
the product growth stages in Figure 9-1.
•
How might planning decisions be affected by the firm's growth?
•
How can the owner empower employees to provide excellent customer service?
•
Cite several differences between the work responsibilities of a project manager and a staff
(or mid-level) designer.
•
What does it mean for the owner to be able to see the "big picture?"
•
Why is the "big picture" important to the health of an interior design practice, regardless of
the size of the firm?
•
Discuss the importance of motivating employees in a design firm.
•
Name the four functions of management and explain each function.
Sample Questions
Multiple Choice
1. An interior design firm has been in existence for several years. It has experienced substantial
revenue increases over those years and added several employees. However, it is
experiencing internal struggles between the owners. It is MOST likely to be in which stage
of business?
A. Start-up.
B. Growth.
C. Maturity.
D. Decline.
24
2. Which is NOT considered an important management concern for a firm with multiple
employees?
A. Developing the process for how the firm will market for increased business.
B. Refusing to carry some catalogs in the library and accepting others.
C. Insisting on reviewing all design plans before they are taken to a client.
D. The owner preparing quarterly income tax forms himself or herself.
3. A style of management where all decisions about design style and execution, project
management processes, and office organization are made by the owner is called
A. Facilitative.
B. Empowerment.
C. Autocratic.
D. Guidance.
4. Of the primary business organizations found in interior design as discussed in the text,
which would most closely describe the firm that exclusively designs interior spaces for a fee
and does not sell merchandise at all?
A. Architectural practice.
B. Independent interior design firm.
C. Office furnishings design department.
D. Residential studios and/or stores.
True–False
1. The firm most likely to be in the decline stage of business is the one in which the owner is
thinking of retiring.
2. The chain of command clarifies any formal reporting structure within a business.
3. In Jane's design practice, her project managers are allowed to make all necessary decisions
regarding the execution of the design concepts developed by Jane and her design staff. This is
an example of empowerment.
4. According to the text, the MOST common way for an interior design practice to be organized
is as a partnership which each partner sharing in responsibilities.
25
CHAPTER 10: The Planning Function
Key Terms
Variance reports
Business goals
Business objectives
Business strategies
Budgeting
Zero-based budgeting
Annual plan
Strategic planning
SWOT analysis
Secondary sources
Primary sources
Discussion Items
•
Why is it important for a firm to plan in terms of priorities?
•
Why is it important to include the input of the employees in the planning process?
•
How do managers use variance reports to help them make decisions?
•
What is strategic planning and why is it important even for the small design practice?
•
What is the purpose of the strategic plan? How is it different from the annual plan and the
marketing plan?
•
What is SWOT analysis and how is applied to the planning process?
•
Name and briefly describe the four elements that make up SWOT analysis.
26
•
Describe the difference between internal and external analysis in order to develop a
marketing plan.
•
What are the differences between primary and secondary sources of information?
•
What are the difference between goals, strategies and tactics?
•
Discuss how simple questionnaires "administered" to current and past clients can help the
design firm in its strategic planning.
•
Why is budgeting such an important part of any planning process?
•
What is meant by "measuring performance?"
Sample Questions
Multiple Choice
1. These reports help an owner review actual progress against project progress concerning the
operations and planning of the design firm.
A. Chart of accounts.
B. Variance reports.
C. Break-even analysis reports.
D. Utilization reports.
2. This type of business planning helps the firm see to its future since it is concerned with the
long range.
A. Business plan.
B. Marketing plan.
C. Operations plan.
D. Strategic plan.
3. SWOT analysis can offer the firm a great deal of information that can be used to investigate
where it wants to go. Which statement is NOT a type of information that can be investigated
as part of the external analysis portion of SWOT?
A. How the Internet will affect the firm.
B. A rise in the interest rate on loans.
C. Determine staff requirements for a new design specialty.
D. A new competitor is heavily targeting the firm's former commercial clients.
4. Mary Anne is planning to use secondary sources for planning information. Which is an
example of a secondary source of information?
A. Trade association data.
B. One-on-one interviews with former clients.
C. A focus group.
D. Questionnaires mailed to prospective clients.
5. Broad statements of what Sally's design firm is hoping to accomplish are referred to as
27
A.
B.
C.
D.
Tactics.
Goals.
Strategies.
Plans.
6. More often, this type of plan deals with the 4 "Ps".
A. Strategic plan.
B. Annual plan.
C. Marketing plan.
D. Financial resources plan.
True–False
1. According to the text, SWOT stands for strengths, weaknesses, options, and threats.
2. A strategic plan is a process for identifying a vision for the firm and its future by
establishing its mission, goals, strategies, and tactics.
3. Information gleaned from the business section of the newspaper is considered a primary
source of research information.
4. Budgeting is a necessary part of the strategic plan.
CHAPTER 11: Personnel Management
Key Terms
Organizational chart
Hourly wage
Job description
Performance evaluations
Employee handbook
Implied contract
Fringe benefits
Merit pay
Bonus plans
Cost-of-living allowance (COLA)
Job classifications
Compensation
Gross salary
FICA
Net pay
Straight salary
Compensatory time
Commission
Gross margin commission
Incentive compensation
28
Discussion Items
•
What is the purpose of a job description? What elements are commonly detailed in a job
description?
•
Why is it important for a firm to have job classifications?
•
What is the purpose of a performance evaluation? What should performance evaluations tell
the employee?
•
List and discuss the four reasons for doing performance evaluations.
•
What is the basic process for a performance evaluation, as described in the text?
•
What is the purpose of an employee handbook? What elements are commonly detailed in
an employee handbook?
•
Why can statements in an employee handbook be interpreted as part of an implied contract?
Give an example of such a statement and explain why it can have the "implied contract"
implication attached.
•
Briefly discuss the fringe benefits listed in Figure 11-8.
•
Are Social Security contributions and Workers Compensation considered employee benefits?
•
Describe the differences between these compensation methods: hourly wage, straight salary,
and commission.
•
Describe the different kinds of incentive compensation payments mentioned in the text.
•
Discuss the different commission structures you know to be common in your market area.
Sample Questions
Multiple Choice
1. The chain of command signifies
A. The formal communications patterns within the office.
B. The way design work is done in the office.
C. The informal reporting structure within the office.
D. The order of presentation when doing a marketing presentation.
29
2. The job responsibilities for each staff member are FIRST spelled out in this document.
A. Employee handbook.
B. Job descriptions.
C. Job classifications.
D. Performance evaluations.
3. Job descriptions are used to
A. Help the client understand what the project sequence will be.
B. Describe duties, skills, and other qualifications of employees.
C. Describe what is required to obtain a project from a client.
D. Help the applicant in the interview process.
4. The BEST way for an employee to determine how well he or she is progressing at a firm is
A. Being extremely accurate about time records.
B. Requesting a formal review of performance at least once a year.
C. Never being late for work or missing a day for any reason.
D. Constantly asking questions and deferring to others for decisions.
5. The PRIMARY reason for conducting formal performance evaluations is
A. Meeting federal regulations on employment.
B. Determine who will get a salary increase.
C. Help the owner know who to hire next year.
D. Encourage the development of the employee.
6. This item of information is generally NOT in an employee handbook.
A. Employee hiring policies.
B. How to fill out purchase orders for special client orders.
C. A description of the standard work week, i.e., hours of operation.
D. Details on paid holidays and other paid days off.
7. Paid vacations, sick leave, and group health insurance represent
A. Employee benefits which may be given to employees.
D. An industry average of ten percent over salary amount.
C. Payments by employers only for employees on an hourly wage.
D. Items that all employers are required by the government provide employees.
8. The compensation method used when interior designers do not sell merchandise.
A. A percentage of the value of the merchandise they specify for each project.
B. An hourly wage for overtime, but straight salary for regular work hours.
C. A set salary rate paid every week to two weeks.
D. Compensation based on the gross margin of the project cost.
9. The term for the compensation method when a designer is provided some compensation over
and above regular compensation because of excellent service to the company.
30
A.
B.
C.
D.
Commission.
Merit.
Incentive salary.
Benefit.
10. A commission based on the gross margin is calculated on
A. A percentage of the difference between selling price and cost of goods.
B. A percentage of the gross sales for the month.
C. A percentage of the cost of goods ordered by a client.
D. A percentage of the difference between suggested retail and the selling price.
True–False
1. Classifying jobs within a design firm help everyone know who is responsible for what and
helps with the professional progress of completing a project.
2. Job descriptions help define work experience requirements for each type of job.
3. Employee handbooks can be subject to the legal concept of implied contracts.
4. A designer is paid a fixed amount of income every two weeks no matter how many hours
during those two weeks he or she works. This describes the straight salary compensation
method.
5. Informal performance evaluations are better than not having any type of formal performance
evaluations in order to determine raises.
31
CHAPTER 12: Legal Issues of Employment
Key Terms
Implied contracts
Employment contracts
Employment at will
Agency relationship
Restrictive covenants
Independent contractor
Moonlighting
Termination for cause
Noncompete agreements
Sexual harassment
Whistle blowing
Wrongful discharge
Independent contractors
Shop-right doctrine
Quid pro quo
Legal Requirements
Title VII of the Civil Rights Act
Equal Employment Opportunities Act
Civil Rights Act
Age Discrimination in Employment Act
Americans with Disabilities Act
Equal Pay Act
Equal Employment Opportunity
Commission (EEOC)
Executive Order 11246
Fair Labor Standards Act (Wage-hour law)
Occupational Safety and Health Act (OSHA)
National Labor Relations Act
Family and Medical Leave Act
COBRA
Discussion Items
•
How do the Title VII of Civil Rights Act of 1964, Equal Employment Opportunities Act of
1972, and the Civil Rights Act of 1991 protect the employee?
•
As discussed in this chapter, what kinds of things do the equal employment acts prohibit in
terms of job applications or interviews?
•
How does the American with Disabilities Act affect employees?
•
How does the Equal Pay Act of 1963 protect employees?
•
As design director, Mary Smith has the authority to sign purchase orders. Is she a true legal
agent of the deign firm? Why or why not?
•
What are the specific legal duties of an employer to the employee? The employee to the
employer?
•
Explain "employment at will" and how it relates to an employer's ability to fire an employee.
32
•
Assuming a senior interior designer has no employment contract, is she required to provide
notice to the owner of the firm when she decides to move on to a different company? How
does this impact the concept of "employment at will"?
•
What is "whistle-blowing"? Give an example of how it might impact the operations of an
interior design business.
•
How does a design employee protect himself or herself from wrongful discharge?
•
Discuss each of the five key issues that are commonly covered in employment contracts.
•
Describe a situation where a restrictive covenant in an employment contract might not be
enforceable.
Mitch Green works for a design firm on a part-time basis preparing construction drawings in
CAD. Generally, he works in the office of the design firm although he does not attend
staff meetings. He does not get any benefits like health insurance. Is Mitch an employee or
an independent contractor? Why (regarding your choice)?
•
•
Identify the differences between an employee entitled to company benefits and an
independent contractor who will receive no benefits.
•
Which federal regulations discussed in the book provide guidelines concerning sexual
harassment?
•
What should an employee do if he or she feels he or she has been sexually harassed?
•
What is meant by quid pro quo? Give an example as might happen in a design office.
•
Can sexual harassment occur between peers? What about between a designer and a client?
Sample Questions
Multiple Choice
1. Which law, discussed in the text, regulates conditions for a safe workplaces?
A. Fair Labor Conditions Act.
B. Equal Employment Opportunity Act.
C. Civil Rights Act of 1964.
D. Occupational Safety and Health Act.
2. ABC Interiors refuses to hire a divorced employee because the employee has small
children. In this case, the company
A. Is discriminating against the employee under the Family and Medical Leave Act.
B. Is discriminating against the employee under the Equal Employment Opportunity
Act.
C. Has a right to refuse to hire the employee based on the employment at will principle.
D. Has a right to refuse to hire the employee based on the COBRA Act.
33
3. You owe your employer many obligations. Which duty is the employer obliged to
provide to you?
A. Loyalty.
B. Reporting activities.
C. Keeping your confidences.
D. A means to do your job.
4. Joe is a senior designer employed at an interior architecture firm. He has worked with this
firm for five years. Yesterday he signed a contract with a client to design a real estate
brokerage office. Which is CORRECT?
A. Joe had the right to sign the contract since, based on what we know, he is an agent of
the firm.
B. Joe should not have signed the contract since he is an employee, not an agent of the
firm.
C. Joe had a right to sign the contract since he is a senior designer and has many years of
experience with the firm.
D. Joe should be fired for signing the contract.
5. Under the concept of agency, an employee owes several duties to the employer. Which
example is NOT an example of a duty of the employee to the employer?
A. Jane has been calling possible new employers for job interviews during work hours.
B. Mark neglected to tell his boss that Mrs. Williams will not be taking the antiques that
are in transit for her home.
C. John has had to purchase a new version of CAD software needed to prepare drawings
for his job and will not be reimbursed by the owner.
D. Margo has reported the owner of the firm she works for to the federal government for
unfair salary policies.
6. Which is a TRUE example of wrongful discharge?
A. Alice was fired after she was absent for two weeks while serving on a superior court
jury.
B. Arthur was found to be taking accessories out "on approval" but never billing the
clients for the items.
C. Ronnie was terminated after six months of lower than average productivity levels.
D. Joan was fired after she argued with the owner in front of a client so that Joan and the
owner were yelling at each other.
7. This clause in an employment contract puts limits as to what information or documents a
designer can take if the designer moves to a competing design firm in the same city.
A. Territory rights.
B. Employment responsibilities.
C. Noncompete agreement.
D. Loyalty expectations.
8. Sally works part-time doing CAD work for a sole proprietor, Betsy. Sally works Monday
through Friday mornings at Betsy's office and uses equipment at Betsy's office to perform
the CAD work. The work she does for Betsy is to finish working drawings from sketches
34
prepared by Betsy. On Tuesday and Thursday afternoon, Sally uses Betsy's CAD equipment
to complete drawings she needs for her own design projects. These projects are not Betsy's
clients and do not "go through" Betsy's books. Which is CORRECT?
A. Sally should be considered an employee of Betsy.
B. Sally is an independent contractor.
C. Betsy must pay social security taxes on Sally even though Sally is not an employee.
D. Sally should not be using Betsy's computers on Tuesday and Thursday.
9. The Latin term quid pro quo is most closely associated with
A. Sexual harassment.
B. The agency relationship.
C. Employment at will.
D. Wrongful discharge.
10. According to the text, what should the employee do if he or she feels that he or she has been
the subject of sexual harassment by the boss?
A. Document the harassing behavior with the date and description of what transpired.
B. Immediately contact an attorney in order to begin legal proceedings.
C. Submit a letter to the boss who did the harassment,.
D. All of the above are suggested in the text.
True–False
1. The Americans with Disabilities Act does NOT affect employees.
2. Moonlighting is generally forbidden by the concept of loyalty within the agency
relationship.
3. A termination for cause statement in an employment contract protects the employer from the
employee quitting without notice.
4. Harry provides CAD services to small interior design firms while operating his own business
designing medium sized tenant improvement space planing. Harry would be an independent
contractor to these small design firms.
5. It is NOT wrongful discharge for an employee to be fired for excessive lateness.
6. Statements in an employee handbook can be construed as implied employment contracts.
35
CHAPTER 13: Legal Responsibilities
Key Terms
Tort
Criminal offense
Negligence
Duty of reasonable care
Breach
Proximate cause
Intentional torts
Assault
False imprisonment
Defamation
Fraud
Invasion of privacy
Misrepresentation
Puffing
Conversion
Codes
Nuisance
Barrier-free regulations
Plan Review Boards (PRB)
Building codes
36
Libel
Slander
Red-lined
Life Safety Code
Americans with Disabilities Act
Discussion Items
•
What are the differences between criminal law and tort law?
•
What are the four key elements that define negligence?
•
Give three examples of negligence as relates to the practice of interior design.
•
Does physical injury to a person have to occur for an act to be negligent?
•
Give an example of what is meant by "proximate cause."
•
Describe "assumption of risk" as it might happen during an interior design project.
•
Why is it unwise to exaggerate claims about service, products, or other claims when talking
to a client?
•
Who has the responsibility to write and enforce codes?
•
What are model codes?
•
How do the building codes affect the practice of interior design in your jurisdiction?
•
Describe what issues are handled by the fire safety or life safety codes.
•
How might the adoption of the International Building Codes affect the practice of interior
design in your jurisdiction?
•
Is the Life Safety Code the definitive code on fire safety? If not, name at least one other code
that deals with issues of fire/life safety.
•
When did the Americans with Disabilities Act (ADA) go into effect?
•
•
What does it mean that the Americans with Disabilities Act is a civil rights law rather than a
universal building code?
What are the responsibilities of the plan review boards?
•
What happens if your drawings are returned from the building department "red lined"?
•
Why should an interior designer be concerned about his or her legal responsibility in the
practice of the profession?
37
Sample Questions
1. A crime has been committed when
A. A designer, on purpose, substitutes one grade of carpet for another without telling the
client.
B. A design employee commits an act regulated by statute such as stealing merchandise
from his employer's design studio.
C. A designer orders the wrong merchandise and insists the client take the goods as
delivered.
D. A designer specifies flooring at the entrance of a building and customers of that
building slip and fall on more than one occasion.
2. Which statement is FALSE concerning torts?
A. The act is against one person by another.
B. A tort is a civil action.
C. A tort can be a criminal action.
D. The remedy for a tort is always imprisonment.
3. Alan Young specified and sold a carpet to a commercial client that was, according to Young,
appropriate for corridor traffic as in a restaurant. The client sued Young after a cigarette
dropped on the carpet started a fire resulting in $500,000 of damage. They type of suit that
would MOST be likely filed by the client.
A. Negligence.
B. Breach of contract.
C. Slanderous liability.
D. Criminal misconduct.
4. Alex Grant informed his client that he had been directly responsible for the design of six
major hotels and was fully capable of doing hotel design work. In truth, Grant had been an
intern two years ago in a design office that did hotels. He has never been responsible for that
kind of project. The hotel he is working on now is hopelessly behind schedule and at a crisis
point. The client is ready to sue and would MOST likely file which kind of law suit?
A. Professional negligence.
B. Defamation.
C. Nuisance.
D. Criminal misconduct.
5. Which situation would NOT be cause for a professional negligence suit or claim against an
interior designer?
A. Specifying a project that is 50 percent over the expressed budget.
B. Omitting the full finish notation on a purchase order.
C. Specifying custom wall paneling for a doctor's office.
D. Ordering the wrong class (related to fire safety codes) of carpet for a hotel ballroom.
6. Taking pictures of the interior of a client's home without permission is considered
38
A.
B.
C.
D.
Negligence.
Invasion of privacy.
Defamation.
Trespass.
7. Mary Brown, when talking to a client about a possible design contract said, "In my opinion,
we are the best design firm in town." If this is not true, Mary would be guilty of
A. Negligence.
B. Misrepresentation.
C. Strict liability.
D. Nothing, since she was expressing an opinion.
8. Which statement is false about the considerations that the harmed party must prove for a
designer to be guilty of negligence?
A. The plaintiff breaches a duty to the defendant.
B. The defendant owes a duty of reasonably care.
C. The act caused damages.
D. A physical injury occurred.
9. These codes are primarily responsible for establishing building and interior construction
standards to ensure a reasonable measure of safety in case of a fire.
A. Americans with Disabilities Act.
B. Life Safety Codes.
C. Building Codes.
D. Barrier-free Codes.
True–False
1. In using contributory negligence as a defense, it must be shown that both sides were
negligent and that injury resulted.
2. In a cause of action concerning negligence, there must ALWAYS be physical injury to an
individual due to the actions of the interior designer.
3. Noncompliance with codes can result in work being stopped and even torn out.
4. Codes are systematic bodies of law created by agencies and enforced by the government to
protect the public.
5. Fraud occurs when a designer intentionally misrepresents facts in order to obtain personal
gain.
6. The purpose of the plan review board is to insure that the project meets requirements for
design competition standards.
39
CHAPTER 14: Warranties and Product Liability
Key Terms
Uniform Commercial Code (UCC)
Warranties
Warranty of title
Express warranty
Products liability
Title
Lien
"Basis of the bargain"
Puffing
Strict liability
Federal Trade Commission
Magnuson-Moss Warranty Act
Implied warranty of merchantability
Implied warranty: fitness for a particular
purpose
Liability without fault for design defects
Discussion Items
•
What is the intent of a warranty?
•
Discuss the concepts behind the warranty of title and express warranty .
•
What happens if a contractor puts a lien on your project? Could the designer attach a lien to
a project? Could the client?
•
Give an example of how the "basis of the bargain" relates to express warranties.
•
How might "puffing" affect an express warranty?
•
Is it necessary to use the words "warranty" or "guarantee" when discussing a product to form
an express warranty?
•
How does the implied warranty of merchantability affect the interior designer who specifies
and sells furniture?
•
A staff member in your company told the client that granite kitchen counter tops would not
absorb stains since they were "coated." The client agreed to use the product and a few
months after installation, grape juice was spilled on the top causing a large stain. How might
your firm be liable related to any possible warranty?
•
Explain the difference between a full and limited warranty as regulated by the MagnusonMoss Warranty Act.
40
•
What would it mean if a chair on your sales floor has a notation "as is" on the price tag?
•
List the three elements that can be applied to manufactured products that the consumer must
show regarding a product and a strict liability case.
•
You have sold a dining table and chairs to Mr. and Mrs. Green. On the tag in the store the
table was marked "As Is," but this notation was left off the sales confirmation. What
warranty liability do you have (if any)?
•
Discuss the issues surrounding "liability without fault for design defects".
•
If someone other than the owner of a purchased good is injured when the good fails, could
the injured third party sue under any part of warranty law? Discuss this issue.
•
Mr. Black purchased 70 chairs for his new coffee shop. You specified these chairs from a
company that was new to you, meaning you had not purchased goods from them in the past.
Within three months, eight of the chairs had suffered broken legs and one customer was
threatening to sue Mr. Black due to an injury received when a chair leg broke. Discuss what
liability you might have, if any, in this situation.
•
Design drawings prepared within your office were used to construct an indoor gazebo at a
restaurant. There were no notations on your drawings that they were not for construction.
Would you be liable if the floor failed when a large number of people gathered within the
gazebo?
Sample Questions
Multiple Choice
1. Warranties serve to protect
A. The manufacturer in case the designer incorrectly specifies a product.
B. The buyer should the goods not meet appropriate standards related to the specific
product.
C. The manufacturer by placing a burden on the buyer to select carefully before signing
a purchase agreement.
D. The seller placing an absolute and irrevocable responsibility on the buyer.
2. Joan has 12 light fixtures in her warehouse. Six are promised to clients–though not billed.
The other six are in her inventory. Considering these lamps as a group, which is TRUE about
title?
A. Joan has title only to the six in her inventory.
B. Joan has title to all 12 light fixtures.
C. The manufacturer still has title to the six being held for clients.
D. Joan does not have title to the six light fixtures being held for clients.
3. Ralph sold 30 Knoll Cesca chairs to Benny's Sandwich Shop and delivered the chairs 95 days
ago. He billed the sandwich shop immediately after the chairs were delivered and signed for
41
by the shop owner. As of yet, the shop has not paid for the chairs. Ralph has placed a lien on
Benny's Sandwich Shop. What does that mean?
A. Ralph has title to the disputed goods even though they are in possession of Benny.
B. Benny has title to the disputed goods since they are on the property of Benny's
Sandwich Shop.
C. Knoll has title to the goods as they have not been paid for by the sandwich shop.
D. Benny could sell the chairs and then use the money to pay the bill due to Ralph.
4. A designer, anxious to conclude a long presentation, says "the chair for the dining room will
not need reupholstering for five years of normal wear". The designer has entered into
A. An express warranty.
B. A firm offer.
C. A warranty of title.
D. A strict liability warranty.
5. The information provided by the interior designer concerning the appropriateness of
wall covering specified for the patient exam rooms was the primary influence on the decision
of the doctor to purchase the wall covering. This forms what is referred to as
A. An express opinion.
B. The basis of the bargain.
C. A warranty of products liability.
D. An implied in fact warranty.
6. Under this type of warranty, the goods must be of average to fair quality and comparable in
quality to other similar goods as well as fit for the normal purpose of the goods. This type of
warranty is
A. An express warranty.
B. An implied warranty of merchantability.
C. A warranty of title.
D. A warranty of fitness for a particular purpose.
7. A product that an interior designer specifies for a project fails causing harm to a client or a
guest of the client. The interior designer can be considered liable because of
A. Warranty of title.
B. Warranty of fitness.
C. Strict liability.
D. Liability without fault.
True–False
1. Strict liability means people are liable for the results of their acts regardless of their
intentions.
42
2. In a strict liability/product liability suit, the injured party must only prove the goods were
defective when purchased.
3. The Magnuson-Moss Warranty Act requires sellers to provide a written warranty for all
goods sold to the end user.
4. Warranties of fitness can be disclaimed by simply stating "As Is" on the price tag.
5. Designers who create custom furniture products do so with liability for any design defects
in that design.
CHAPTER 15: Financial Accounting
Key Terms
Financial accounting
Revenue
Expenses
Accrual accounting bases
Cash accounting bases
Balance sheet
Assets
Current assets
Cash (on a balance sheet)
Accounts receivable
Inventory
Prepaid expenses
Fixed assets
Marketable securities
Supplies
Depreciation
Amortization
Gross margin
Overhead expenses
Salary expense
Net income or loss
Statement of Cash Flows
Transactions
Debit
Credit
Liabilities
Current liabilities
Accounts payable
Accrued expenses
Deferred revenues
Taxes payable
Current portion of long-term debt
Owner's equity
Drawings
Retained earnings
Income statement
Profit and loss (P & L ) statement
"Pass through"
Cost of sales
Gross revenue
Net revenue
Direct labor
Journal
Ledger
Chart of accounts
Trial balance
Cash management
Posting
Accounts
Work in process
Discussion Items
•
Which individuals would be most interested in the information contained in financial
accounting reports?
43
•
Describe the difference between accrual and cash accounting bases.
•
What is the basic formula or financial outcome of a balance sheet?
•
Which section of the balance sheet always has first claim on assets?
•
Is a firm's inventory of sellable merchandise a depreciable item? Explain why or why not.
•
A client was invoiced for services 120 days ago and has not yet paid the invoice. Is this a
current asset or a liability on the balance sheet?
•
Describe how the investment by owners or stockholders is shown on a balance sheet: sole
proprietorship, general partnership, and corporation.
•
Does a proprietorship balance sheet show a category for retained earnings? Why or why not?
•
What does it mean that the sale of goods must "pass through the hands" of the design firm?
•
Why is it useful to the owner of the firm to record the amount of revenue that comes from
design fees separately from any revenues that are derived from the sale of merchandise?
•
Describe how net revenue on an income statement is derived.
•
Why is it helpful to record direct labor–whether or not it is included as part of the income
statement?
•
Does "gross profit" represent true profit for the design firm?
•
Describe the kinds expenses that could be listed as part of cost of sales.
•
Name five expenses that are considered overhead expenses. Why are these referred to as
expenses needed to "keep the doors " open?
•
What kinds of information does the Statement of Cash Flows report?
•
What is the difference between "debit" and "credit" ?
•
What is a "T-account" and what do the parts of the "T-account" represent?
•
What kinds information do journal records show?
•
Describe the purpose of cash management.
•
Discuss some techniques that would be useful in ensuring good cash flow.
Sample Questions
44
Multiple Choice
1. The accounting report that shows the financial position of a firm at a particular moment
in time by reporting its assets and liabilities.
A. Accrual report.
B. Balance sheet.
C. Income statement.
D. Profit and loss statement.
2. Which statement is a TRUE representation of the total result of a balance sheet?
A. Total assets equal total liabilities plus owner's liabilities.
B. Total assets plus total liabilities equals owners equity.
C. Total assets equal owner's equity plus accounts receivable.
D. Total assets plus accounts receivable equals total liabilities.
3. Which is not a liability on a balance sheet?
A. Deferred revenues.
B. Prepaid expenses.
C. Owner's equity.
D. Short-term loans.
4. Accounts payable represent
A. Non-current assets.
B. Money clients must pay to the designer.
C. Money the design firm owes to others.
D. Current assets.
5. The accounting term associated with the funds that the sole proprietor pays himself or herself
as compensation is
A. Salary.
B. Assets.
C. Drawings.
D. Equity.
6. The accounting report that formally shows the revenues and expenses of the firm for a
stated period of time is
A. Balance sheet.
B. Profit and loss statement.
C. Statement of financial condition.
D. Chart of accounts.
7. Direct Labor on a design firm's income statement represents
A. The work of the bookkeeper.
B. The work that a designer spends on billable projects.
45
C. The work that a contractor spends on a project.
D. The work of an independent contractor hired to help on a project.
8. Sales and administrative expense for a business
A. Are subtracted from net revenue to get gross margin.
B. Represents assets on a balance sheet.
C. Include direct labor and computer plotting charges for a project.
D. Include such things as rent, insurance and management salaries.
9. The statement of cash flows reports
A. Inflows and outflows of revenue from operating, investing, and financing activities.
B. Monthly revenue and expense projections.
C. How much revenue will be available to pay for bills in the following three months.
D. Expenses due and payable so investors can decide whether to invest in the company.
10. The MOST important reason for consistently doing cash management reports is to
A. Forecast cash needs over a few to several months.
B. Budget for expected salary increases.
C. Recognize when standard accounts payable like rent will be due.
D. Understand when you can purchase a new computer system.
True–False
1. In accrual accounting, revenue and expenses are recognized in the period the firm actually
receives the payment or pays the bill.
2. Prepaid expenses are reported as amounts that the client has paid to the designer in advance
of actually ordering of goods.
3. Liability accounts ALWAYS have first claim on the assets of a company.
4. The gross margin amount is the amount of revenues left to cover operating expenses.
5. The statement of cash flows reports flows from operating, investing, and financing activities.
6. The term for actually entering financial information into a journal or ledger is called posting.
7. To credit an account on a T-account, always means you increase the account.
46
CHAPTER 16: Financial Management
Key Terms
Financial management
Profit ratios
Return on total assets (ROA)
Inventory turnover ratio
Managerial accounting
Variance analysis
Average collection period
Working capital
47
Quick ratio (or acid test)
Information reports
Performance reports
Direct labor
Utilization rate
Gross margin percentage
Unfavorable variance
Favorable variance
Indirect labor
Discussion Items
•
What is the difference between financial management and financial accounting?
•
Who is responsible for the financial management of the firm?
•
What does the profit margin on sales ratio tell a design firm owner?
•
Why is the average collection period ratio important?
•
Your design firm carries a substantial amount of inventory of accessories. In addition, your
company is in need of funds to purchase a new computer system. How would the
information provided by the inventory turn-over ration be important to this situation?
•
Mary Smith interiors needs to move the studio to larger facilities. She has considered
building a facility rather than continuing to lease. What ratios would you expect a lender to
want to analyze so that Mary can obtain a loan to build her new studio?
•
Describe and define at least two of the ratios discussed in the text.
•
Discuss the reasons that these reports are valuable to the practice owner: work in process,
revenues from fees versus product sales, a variance report on the month by month employee
utilization rate.
•
What do the terms "favorable" and "unfavorable" have to do with variance analysis?
•
Why is it important to control overhead?
Sample Questions
Multiple Choice
1. The reports produced by managerial accounting techniques would be of most interest to
A. Managers and/or the owner of the design firm.
B. Loan officers to establish a design firm's credit rating.
C. The employees other than the owner of the design firm.
D. Potential investors.
2. If the owner of a design firm wanted to know what kind of profit was obtained based on
each dollar of sales generated, he or she would be using this.
48
A.
B.
C.
D.
ROA.
Gross margin.
Debt to sales ratio.
Profit margin on sales ratio.
3. This ratio will clarify for the design firm owner how much cash is available at any time to
pay daily operating expenses.
A. Working capital ratio.
B. Debt to sales ratio.
C. Net profit ratio.
D. Return on equity ratio.
4. This report BEST shows how productive an individual employee is in producing revenue for
the design firm.
A. Work in process/receivables report.
B. Employee utilization report.
C. A report showing the billed revenues to each client.
D. None of the above will give the information desired.
5. Which strategy will NOT increase gross profit for Jane Austin's studio?
A. Raising her design fee billings 10 percent.
B. Billing more hours at the current fee.
C. Ordering merchandise only from vendors who charge NO freight or delivery.
D. Lowering overhead by charging the client for copies and costs of making prints of
working drawings.
True–False
1. Financial management produces reports that are only of interest to the owner or managers
of a design firm.
2. A liquidity ratio shows the design firm owner his or her ability to pay debts.
3. The turn-over ratio is of primary use to large design firms in staff planning and hiring.
49
CHAPTER 17: Determining Design Fees
Key Terms
Billing rate
Direct personnel expense (DPE)
Multiple
Hourly fee
Fixed fee method
Lump sum fee method
Square footage method
Percentage of merchandise and
product service method
Value-oriented fee method
Retail method
Multiplier
Percentage off retail method
Consultation fee
Cost plus percentage markup method
Combination method
Indirect job cost factors
Discussion Items
•
What factors must be calculated to determine a multiplier?
•
Why should a firm calculate a firm multiplier rather than use a standard multiplier?
•
What are some of the key issues that affect which type of fee method would be
appropriate for a particular firm? For a particular project?
•
Describe some of the differences in the design process between residential and commercial
projects. How might these affect the fee method you would use to charge these differing
clients?
•
Describe two or three situations where it is best to use an hourly fee.
•
What might be some of the advantages and disadvantages of using an hourly rate based on
the experience level of the design staff?
•
What factors must be carefully considered when determining the amount of fee on a fixed fee
method?
•
In what kinds of situations would it be good to use the fixed fee method?
•
In order to determine a square foot fee for a hospitality space, what issues should you
consider?
50
•
What advantages and disadvantages in general exist when using the percentage of
merchandise and product services fee method as the only method of compensation?
•
Describe the value-oriented method as a fee basis.
•
Explain two or three problems in using both the discount off retail and cost plus markup fee
methods.
•
What are the key considerations in estimating design fee amounts?
•
Name at least two indirect job cost factors and explain how they can affect the
profitability of a design contract.
Sample Questions
Multiple Choice
1. In order to adequately determine a billing rate, the interior designer must consider all of
these items EXCEPT
A. The designer's salary rate.
B. A reasonable profit percentage.
C. Competitive markup rates.
D. Overhead expenses.
2. The direct personnel expense is used by design firms to
A. Determine a proper salary multiplier to establish a fee basis.
B. Clarify direct labor on an income statement.
C. Estimate overhead expenses for the quarter.
D. Estimate salary increases for the next year.
3. This staff member's time is rarely considered billable to a client.
A. The owner.
B. The office administrator.
C. An entry level designer.
D. The project manager.
4. This factor has very little, if anything, to do with the designer's determination of which fee
method to use.
A. The scope of services for the project and the designer's total responsibility.
B. The amount of research needed to determine products which are appropriate.
C. Whether or not the client has worked with a designer before.
D. The amount of overhead expenses that must be paid for the next month.
5. The contract says, "The fee for this project will not exceed $ 7500. You will only be billed
for actual time worked." This statement indicates which kind of fee basis?
A. Hourly rate.
B. Lump sum rate.
C. Square footage factor.
51
D. Value added fee.
6. A design project for Mr. Miller–who has never worked with an interior designer before–
requires the interior designer, Jenny Jones, to consultant with an architect, provide
construction drawings for non-load bearing construction, and prepare specifications for
the construction work and furniture items for Miller's summer house. As described,
which fee method should BEST compensate Jones for her time?
A. A fixed fee since the job is well defined.
B. A consultation fee since all Jones is doing is consulting.
C. An hourly rate with a flat fee for the preparation of the construction drawings.
D. A square foot fee that is based on similar projects.
7. The fixed fee method is a satisfactory method of charging fees when
A. A large amount of like items are to be purchased.
B. The amount of goods to be purchased are small in comparison to the time involved in
the design project
C. When it is easy to determine and control the time and requirements of the project.
D. All of the above.
8. Jennifer, an interior designer, has estimated that the bid price for all the furniture for a
restaurant will be $165,000 and all the construction costs, including architectural finishes,
will be $328,900. If she negotiates her design fee based on a percentage of merchandise and
services, what will be her fee, assuming the percentage is eight percent?
A. $ 13,200.
B. $ 26,312.
C. $ 32,780.
D. $ 39,512.
9. The value added fee method
A. Bases the fee more on the designers experience than the amount of time to do a job.
B. Means the fee is determined by a value added to the project.
C. Can only used in architecture since value is added to the building.
D. All of the above.
10. The fee method that is the MOST common method used by residential designers who sell
merchandise.
A. Discount from retail.
B. Cost plus mark up.
C. Retail markup.
D. Percentage of merchandise and services.
11. Which of these is NOT considered an indirect job factor that can reduce the profitability of a
design project?
A. Overtime work by designers responsible for the job.
B. S special permit to unload furniture from delivery trucks.
C. Preparation of contract documents.
D. Client requests to include new areas in the project scope.
52
True–False
1. The firm's multiple is based exclusively on salary rate and profit margin.
2. When competition is tight, a good strategy is to utilize the concepts of the value-oriented fee
method.
3. With a fixed fee, the client is expected to pay the quoted fee whether the designer actually
works that many hours or not.
4. Magna Hotels has negotiated a design fee of eight percent of cost. The ONLY fee method
this statement describes is that of the cost-plus percentage fee method.
5. The retail method provides a potentially higher gross profit margin for work on a project
than the percentage of merchandise and product services method.
6. Combining different types of fee methods on the same project is only confusing to the client
and should never be done.
CHAPTER 18: Preparing Design Contracts
Key Terms
Contract
Offer
Counter offer
Agreement
Acceptance
Consideration
Contractual capacity
Mutual assent
Statute of Frauds
Letter of agreement
Compete performance
Legality
Offeree
Assignment
Legal damages
Scope of services
Reimbursable expenses
Per diem
Arbitration
Retainer
Deposit
Breach of contract
Material breach
Performance
Specific performance
Substantial completion
Offeror
Mirror image rule
Delegation (concerning contracts)
53
Discussion Items
•
What are the basic requirements (elements) of a contract?
•
Define what two parts make up the agreement element of a contract.
•
Is an invitation to bid a contract?
•
Who is the offeror and who is the offeree? How do these relate to a contract?
•
What is the mirror image rule? How is the mirror image rule affected if the client makes a
counter offer?
•
When might you want to use a "Letter of Agreement" rather than a "Contract?"
•
Name the five categories of information that must be part of any contract in order for it to be
enforceable.
•
Mary Smith has presented her client with a contract to do the specification of a new
restaurant. Her contract said that the fee for the project will be a flat fee of $ 15,000. The
client called Mary and said he was only willing to pay $ 12,000. First, describe what is going
on in a legal sense, then what Mary should do in a practical business sense.
•
Describe what kinds of things are legal consideration for design services.
•
Would an oral contract to perform design services be legally enforceable? Why or why not?
•
Describe the three main circumstances in which the Statute of Frauds affects the practice of
an interior designer.
•
Why is it important for a written contract to be prepared for design services even though it
could be an oral contract?
•
Why is it important to clearly state the clients name, address, and a description of the project
at the beginning of a contract?
•
Why is a detailed scope of services so important in the preparation of a contract for design
services?
•
Give three examples of reimbursable expenses.
•
Who might be a third party to an interior design project/contract?
•
The client signed the contract but the designer did not. Is this a valid contract (assuming all
other necessary items were included)? Why or why not?
54
•
What is the purpose of including a section concerning assignment and delegation of
responsibility in the contract?
•
Your client does not understand the clause about ownership of documents. He thought since
he is paying you for preparing the design drawings and specifications, the drawings belong to
him. Discuss how you would explain this ownership clause and why it is important to
include in all of your contracts.
•
Why should you require a retainer for all contracts? Is this the same thing as a down
payment?
•
Explain the different levels of performance discussed in the text.
•
Provide a specific example of how a designer could breach a contract for design services.
How can the client breach the design contract?
Sample Questions
Multiple Choice
1. The agreement part of a legal contract must contain
A. An offer and acceptance.
B. An offer and exact acceptance of the offer.
C. A counter offer.
D. None of the above.
2. Lenny Parker has handed her client, John Westwind of Sails West, Inc. a contract for the
design services to plan and specify the showroom and offices of his yacht sales office in
San Diego, California. In discussing the terms of the contract, Westwind states that the
fee for the project is higher than a competitor, but would rather work with Parker.
Westwind says that he will sign the contract if Parker lowers her fee by ten percent.
What does this exchange mean in terms of defining a contract?
A. Parker should refuse to negotiate in this way as it is unprofessional.
B. Westwind has made a counter offer which Parker can refuse.
C. Parker has made a firm offer since it is in writing and cannot change her offer.
D. Westwind is interfering with the concept of mutual assent.
3. Which statement correctly defines the mirror image rule?
A. Only the owner of the business can sign the contract, just as only the owner of the
design firm can sign the contract–ownership must mirror.
B. The terms of the contract must met local statutes and common law in regard to how
fees amounts are stated.
55
C. A client signs the contract and pays the retainer without any changes or further
negotiation of the terms of the contract.
D. The contract must mirror or be formatted the same for all other contracts issued by the
design firm.
4. An oral agreement for design services or the sale of goods
A. Is legal, though provides no protection for the designer.
B. Is only legal for the sale of goods over $500 but not more than $1000.
C. Is not legally binding on either party.
D. Is only legal for design services charged by the hour.
5. There are situations described in the text which require a contract to be in writing so that it
can be enforceable. Which situation does NOT meet these standards?
A. The interior design process from programming through contract administration for a
residence will take 18 months.
B. The expected amount of merchandise to be purchased by the electronics firm for their
corporate offices is budgeted at $10,000.
C. The interior design process from programming through the end of the designer's
responsibilities at the completion of design development will be completed in 10
months.
D. The client will purchase a small antique table off the showroom floor for a total price
of $420 including tax. The client will take the table home with out the design firm
having to deliver the item.
6. The purpose of a late payment penalty clause in your contract with the client is to protect
A. The client in case you do not deliver goods or services on time.
B. You in case the manufacturer does not deliver goods to your client in time.
C. You in case the client does not pay you within you terms.
D. The client in case you cannot pay the manufacture in time.
7. Matthew Black has been working on a project for Micro Management Systems for three
months. The project is in the schematic design stage and all plans and documents are
targeted for completion in two months. The actual construction of interior partitions is to
begin within 30 days of when the contract documents are completed. Black has decided to
take a senior design position with another firm in another city. Black's responsibilities will
be turned over to Suzanne Masters, another designer in the firm. This change in
responsibility, in terms of the design contract terminology, is called
A. Arbitration.
B. Assignment.
C. Delegation.
D. Mutual understanding.
8. "Per Diem" is a term referring to
A. The amount of money the client pays you before you start working on the project.
B. An allowance for normal travel expenses when the designer goes out of town in the
interest of the project.
C. The fact that the client must pay you even if the project cannot be complete.
D Another term that means the same thing as "retainer."
56
9. Items that are generally considered out-of-pocket and not usually calculated into the fee to
complete a design contract.
A. Reimbursables.
B. Retainer.
C. Credits.
D. Prepaid expenses.
10. This term, when used in a contract, requires funds to be held in an escrow account and the
funds used for only the client who paid the money.
A. Down payment.
B. Retainer.
C. Deposit.
D. Earnest money.
11. The client claims that the interior designer did not fulfill her obligations of the design
contract. The client claims that the drawings the designer produced were only sketches and
the client believed the contract stated that the drawings would be complete working
drawings. Assuming that the client's claim is correct, what type of legal "performance" was
performed?
A. Complete.
B. Substantially complete.
C. Inferior performance.
D. None of the above.
12. Which of the following is false about what "breach" means?
A. One of the parties did not fulfill the obligations of the contract.
B. The client will not have to pay outstanding fees until the breach has been remedied.
C. The court will relieve the harmed party of having to pay outstanding amounts due
until the contracted item is delivered as contracted for.
D. All of the above are true about breach.
True–False
1. A counter offer rejects the original offer and is itself an offer.
2. A valid contract does not exist if there is no statement of the fee or charges for the design
work within the contract.
3. A client offers the designer the client's professional services in exchange for the
goods the client needs. This can be legitimate consideration for the goods.
4. Inferior performance to the conditions of a contract causes a material breach of the
contract and excuses the nonbreaching party from paying fees owed.
5. An arbitrator is someone hired by the client to represent the client as the client's
representative when talking to the designer about the project scope and progress.
57
6. A design project will take longer than one year to complete. It is not necessary to
have written contract for this project.
CHAPTER 19: Product Pricing Considerations
Key Terms
Price
Net price
Wholesale price
Cost price
Suggested retail price
List price
Selling price
End user
Retail price
Discount
Keystone
Prestige pricing
Stocking dealer
Quantity discount
Multiple discount
Title
Delivery
Installation
Door-to-door
Tangible personal property
Fixture
Customer's own material (COM
Sherman Act
FF & E (furniture, fixtures, and
equipment)
Fair trade goods
Trade discounts
Cash discount
Deep discounting
Mark-up
Gross margin (on sales of goods)
Mark-down
Down payment
Seasonal discount
Deposits
Retainer
Advertising allowance
Piggy-back
Freight
FOB
FOB destination
FOB factory
FOB factory–freight pre-paid
Sales tax
Use tax
Competitive bidding
Line item (see glossary)
Federal Trade Commission
Resale tax certificate
Robinson-Patman Act
Discussion Items
•
Explain the difference between net, wholesale, and cost price.
•
Explain the difference between suggested retail, list, and selling price.
58
•
Why is it important to know if a price list from a manufacture is a retail or net price list?
•
What is the purpose of price codes?
•
What is the difference between a multiple discount and a quantity discount? Give examples.
•
What is a cash discount?
•
Explain a seasonal discount. Would a designer ever use a seasonal discount? Explain.
•
What is deep discounting and explain why it happens.
•
If you go into a retail gift shop to purchase some accessories for a client, what kind of pricing
are you likely to obtain from the owner? Can you markup that price in order to make a
gross profit on the sale of the accessories to the client?
•
Discuss prestige pricing and how it might be used to advantage by the interior designer.
•
Explain the difference in selling prices that are discounts from suggested retail and mark-up
from cost. Give an example of each.
•
Explain the differences between down payments, deposits, and retainers.
•
Why is it important for you to use the correct terminology when referring to moneys the
designer requires from the client?
•
What is the difference between "FOB Destination" and "FOB Factory"?
•
Should you charge the client for freight when the catalog states, "FOB Destination?"
•
Give an example that shows the difference between delivery and installation.
•
Does the designer charge sales tax on design services? Is sales tax required on the installation
of wallpaper or the rehanging of drapery? Why or why not?
•
Explain two methods a designer/Specifier can use to budget the cost of goods for a client.
•
How does the designer/specifier assist the client in evaluating products specified for a
project?
Sample Questions
Multiple Choice
1. Which term represents the interior designer's price to the client?
A. Net price.
B. Cost price.
59
C. Selling price.
D. Wholesale price.
2. Which term represents the interior designer's price from the vendor?
A. Net price.
B. Wholesale price.
C. Cost price.
D. All of the above.
3. Net price indicates
A. The price the designer pays.
B. The price the client pays after freight and delivery is added.
C. The price the client pays before taxes.
D. The highest price the product can be sold for.
4. The term "keystone" represents
A. The discounted price to the client from the interior designer.
B. A discount given by a supplier to the interior designer.
C. A discount given by a supplier to the client.
D. None of the above.
5. Which discount term means that the supplier is giving the designer and extra discount for
prompt payment of the invoice?
A. Quantity discount.
B. Multiple discount.
C. Deep discount.
D. Cash discount.
6. Mary Jane Brown, an interior designer, wants to purchase some accessories for her client Mr.
Cannon. Brown needs the accessories immediately as Cannon is ready to move into the office.
Brown goes to a retail gift shop and negotiates a price with the shop owner. This type
of
discount is called
A. Trade discount.
B. Cash discount.
C. Retail discount.
D. None of the above.
7. Which of the following is FALSE about suggested retail price?
A. It is generally a 100% mark-up from net.
B. It is sometimes called list price.
C. The price is suggested by the designer.
D. All of the above.
8. Freight pre-paid means
A. The designer pays the freight before shipping.
60
B. The designer's credit is so good with the factory that you do not pay freight until the
product arrives at your warehouse.
C. The factory pays the freight.
D. You send a check to the manufacturer for next months freight based on your
estimated sales.
9. According to the text, FOB destination means
A. You pay the freight from the factory to your delivery site and you own the goods
when they are put on the truck.
B. The manufacturer pays the freight from the factory to your delivery site and the
manufacturer owns the goods until they arrive at the job site.
C. The manufacturer pays the freight, but you own the goods when they are put on the
truck at the factory and become yours when delivered.
D. You pay the freight from the factory, but the manufacturer owns the goods until they
reach your delivery location.
10. A notion such as 1/10 net 30 on the invoice from a supplier means
A. The retail client gets 10 percent off the purchase price if they pay within 30 days.
B. The designer pays one tenth of the net cost if paid within 30 days.
C. The designer receives a 10 percent discount if he/she pays the invoice with 30 days.
D. The designer receives a one percent discount if he/she pays within 10 days.
11. Which of these items would NOT be considered a fixture?
A. Bathroom cabinets and the sink.
B. Vertical blinds.
C. A floor lamp.
D. Cornice boards.
12. Sally Dean has given an itemized sales order to her client. It states
Item #1: 7 desks at $ 750 each.
Item #2: Design services; 10 hours at $ 55 per hour.
Assuming a 7% sales tax, what would be the sales tax amount for the design services?
A. $ 38.50
B. $ 367.50
C. $ 399.00
D. No sales tax is charged on services in the above situation.
13. For a very large order to the Rand Corporation, you are told by the furniture rep that your
company can buy the needed chairs for 50/4/1. If the chairs retail price is $250 each, your
price for each chair will be
A. $ 118.80
B. $ 120.45
C. $ 135.50
D. $ 157.50
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14. The net price for a sofa is $ 950, the two matching club chairs have a net price of $ 425 each,
and a coffee table will cost the designer $ 300. If the designer charges retail for the coffee
table and puts a 25% markup the sofa and chairs, what would the sales price to the client be
for the group?
A. $ 2318.50
B. $ 2850.00
C. $ 3165.00
D. $ 4000.00
15. Which federal law prohibits price fixing between merchants in the same competitive market?
A. Robinson-Patman Act.
B. Sherman Act.
C. Statute of Frauds.
D. Sellers Code of Law.
True–False
1. A manufacturer's suggested retail represents a 100% markup from net or a 50% discount
to arrive at net.
2. Markup is a term that relates to a percentage added to the cost to arrive at a selling price of
goods.
3. Prestige pricing can be applied to merchandise that is believed to have exceptionally high
quality and can be priced higher than goods of similar type but lesser quality.
4. A designer may legally mark up goods higher than suggested retail.
5. A manufacturer requires an interior designer in Nevada to pay a different price for goods
than a designer in Ohio. This is an example of zone pricing.
6. Delivery refers to situations when products are delivered to the client's home or office and
must be assembled in some way.
7. Use tax is a form of tax that must be paid when the designer purchases goods for his or her
businesses from out of state.
CHAPTER 20: The Sale of Goods and the Uniform Commercial Code
Key Terms
Law of Sales
Sale
Firm offer
Seller
Merchant
Statute of Frauds
Destination contract
Shipping contract
Sales on approval
Restocking charges
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Price
Nonconforming goods
72-hour right of refusal
Material differences
Goods
Title
Conforming goods
Receipt of goods
In lots
Buyer
Risk
Lien
Discussion Items
•
Explain any differences between a seller and a merchant.
•
When does a sales contract exist in law between a designer and a supplier? How is
acceptance acknowledged in a sales contract?
•
Why is an order transmitted by fax a legal order for goods? Does this hold true of other
electronic means of transmitting information?
•
What are the rules concerning the open term provisions that affect a sales contract?
•
Are oral agreements valid for the sale of goods? What if the agreement is for design
services? What if the agreement is for the sale of $ 10,000 of furniture?
•
What must be clarified in a written sales agreement?
•
Ann Bolin received a verbal acknowledgment from her client Henry Eighten for a custom
bedspread and custom cornice board. The value of the items was $900, sell price. Three
weeks later, after the fabric was cut and the goods were in production, Eighten called to
cancel the order. What should Bolin tell him?
•
How is title passed when goods are sold by a vendor to the designer?
•
Explain who absorbs risk with a destination and shipment contract.
•
Discuss sellers rights under a valid sales contract.
•
Explain what the designer can do if the client refuses a delivery due to a color variation.
Assume an otherwise valid sales contract.
•
How can the designer protect himself or herself when a buyer refuses delivery or tries to
cancel an order?
•
What happens if the goods delivered to a client are shown to be nonconforming?
• What is the 72-hour right of refusal? Does it apply in ALL sales situations?
Sample Questions
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Multiple Choice
1. Which item would not be considered a tangible good as defined by the UCC?
A. Design concept sketches.
B. Carpet.
C. Bed spread.
D. Draperies.
2. According to the UCC, a sale has occurred when
A. Title of the goods is passed to the buyer.
B. The purchase order is written.
C. The client signs the contract.
D. All of the above.
3. A purchase order sent by the designer to the manufacturer is lacking the net price of the
goods. Is this a valid sales contract according to the UCC?
A. Yes, since the price is stated in the price list from the manufacturer.
B. No, it must be on the purchase order to the manufacturer.
C. Yes, as long as the quantity and client's name is in the tag for box.
D. No, because it is a firm offer.
4. Receipt of goods occurs when
A. The dining room furniture is delivered to the designer's warehouse.
B. The client's system furniture work stations are assembled at the client's office.
C. The wall paperhanger has taken the UPS delivery of the wallpaper for a client.
D. All of the above.
5. Sean Brooks gives a written sales agreement to Mr. Robinson, his client. The sales agreement
states that the total price of the furniture for the family room is $ 36,000. This is
A. An express warranty.
B. A firm offer.
C. A purchase order agreement.
D. A letter of agreement.
6. According to the text, a destination contract means
A. The goods belong to the designer when they arrive at their final destination.
B. The goods belong to the manufacturer until they arrive at the location indicated on the
designer's order.
C. The risk for damage is the responsibility of the interior designer.
D. The goods belong to the designer as soon as they are placed on the truck at the
factory.
7. The price list from RST Lighting Fixtures says "Shipping FOB Factory". This means that
title of the products ordered belongs to
A. RST until received by the design firm.
B. The designer as soon as the purchase order is received by RST.
C. The designer when the goods are placed on an RST delivery truck.
D. The client when the goods are placed on the designer's delivery truck.
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8. Two days ago, the delivery service for Peaks Interiors delivered two love seats to a client.
The client called the designer, James Anderson, and said that they were the wrong style
and wanted Anderson to have the love seats picked up and the order canceled. In regard
to the LEGAL conditions discussed in the chapter on the UCC, Anderson should
A. Refuse the request as the acceptance of the goods means they belong to the client.
B. Pick up the love seats and send them immediately back to the manufacturer as
nonconforming goods.
C. Require the client to pay a restocking charge to cancel the order.
D. Take the love seats back and refuse to further work with the client.
True–False
1. Alex Keaton trades his real estate brokerage fees for interior design services from
Michael Cane. This trade can be considered at least part of the price for Cane's interior
design services.
2. According to the UCC, an original contract exists even if the price of goods is over
$599 when the goods involved are custom designed/manufactured and cannot be easily
sold to some other client.
3. Hyatt Hotels has agreed to accept delivery of the guest room furniture "in lots". This mean
each item for the guest rooms will be delivered separately such as all beds, all dressers, etc.
4. An unsigned purchase agreement is binding on the client.
5. A firm offer can be revoked by the merchant under any circumstances.
6. When the merchandise is sent via a shipping contract, the issue of risk (from damage in
transit) resides with the manufacturer and the trucking company rather than the designer and
the trucking company.
7. FOB factory warehouse means you pay the freight to your warehouse.
CHAPTER 21: Marketing Interior Design Services
Key Terms
Marketing
Selling
Target marketing
Market segment
Marketing analysis
Demographics
Psychographics
Niche
Four "Ps" of marketing
Marketing mix
Perception
SWOT
65
Discussion Items
•
Discuss the difference between the concepts of marketing and selling.
•
Identify six target markets and discuss why these might good market segments for an interior
design firm to pursue.
•
Explain the pros and cons of niche specialization.
•
What are the 4 Ps of marketing? Explain each.
•
Explain how the clients "perception" of a designer might affect his or her willingness to work
with a particular designer.
•
Discuss the importance of market analysis when preparing a marketing plan.
•
Provide an overview of the purpose and use of a formal marketing plan.
Sample Questions
Multiple Choice
1. Which activity is NOT considered a part of marketing?
A. One-on-one selling of products.
B. Producing a CD-ROM disc presentation.
C. Production of working drawings.
D. Determine what to include in a design contract.
2. Jimmy Steward wants to add the design of movie theaters and play-house theaters to his
interior design firm. He is getting a mailing ready to send to movie and play producers.
What marketing method is Steward using?
A. Target marketing.
B. SWOT analysis.
C. Promotional marketing.
D. Pro forma marketing.
3. Rhonda Bean has exclusively designed second homes in a resort city for the past five years.
It can be said that Bean has determined
A. Her niche market.
B. Her marketing segment.
C. Her target market.
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D. All of the above.
4. Which is not a characteristic used to differentiate market segments?
A. The client's occupation.
B. The interior designer's experience.
C. The location of the project.
D. Why the client is buying the service.
5. George Campbell wishes to work exclusively with clients that own or plan to open fitness
centers. This segment is based on
A. Demographics.
B. Psychographics.
C. Geographic.
D. Product usage.
6. Which type of interior design work does NOT represent a market niche?
A. The interior design of model luxury apartments.
B. The interior design of custom yachts over 65 feet in length.
C. The interior design of residential interiors.
D. The interior design of retail stores under 5000 square feet.
7. This is NOT one of the traditional four Ps of marketing.
A. Perception.
B. Product.
C. Price.
D. Promotion.
True–False
1. Marketing is an inward-looking function in which the design firm convinces the client to buy
the services or products that you want to offer.
2. Designing the interiors of homes exclusively for clients who are over the age of 60 is
considered a niche.
3. The marketing mix includes the price for the design services and what products the interior
designer will be selling.
4. When developing a marketing plan, the designer's fees for services is a minor factor.
5. It is insignificant to consider the general economy in developing a marketing plan. It only
relates to strategic planning.
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CHAPTER 22: Promoting the Interior Design Practice
Key Terms
Promotion
Public relations
Publicity
Referrals
Press release
Promotional tools
Graphic image
Logo
Brochures
Networking
Photo portfolio
Discussion Items
•
Explain two public relations activities that can help in the marketing of a design firm.
•
What is the goal of promotional activities for a design firm?
•
Provide an example of a planned publicity effort. How would this activity help the design
firm in its promotional effort?
•
How does a firm's graphic image influence potential clients?
•
How can a one-page project insert, such as Figure 22-4, be used to improve a design firm's
basic brochure?
•
How can the interior designer improve the quality of referrals that he or she receives from
clients?
•
Discuss how networking at a professional chapter meeting of ASID or IIDA be of benefit to
students?
•
What kinds of strategies should students use to get the most benefits from attending any
professional association chapter meeting or trade show such as one of the Neocon shows?
•
Invite the awards competition chair person from one of the professional association chapters
in your area to discuss the guidelines and requirements for the annual competition. To help
students understand what is often required to enter a competition, ask them to show slides of
award winning projects and competition books if they are available.
•
Invite a professional photographer to discuss the process of taking interior architecture
photos. It is beneficial for the photographer to cover site considerations and how rights are
purchased by the design firm.
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•
Invite a photographer who is very familiar with digital photography and computer
manipulation of images to demonstrate how digital photos are made. He or she would also
be asked to demonstrate how the image can be enhanced in the computer.
Sample Questions
Multiple Choice
1. ALL the efforts of a firm to create and influence potential clients opinions about the firm are
accomplished through
A. Advertising.
B. Public relations.
C. Selling strategies.
D. Press releases.
2. Any unpaid form of non-personal presentation of ideas, goods, or services is called
A. Publicity.
B. Marketing
C. Advertising
D. Promotion.
3. A symbolic representation of the design firm is called a
A. Tag line.
B. Logo.
C. Herald.
D. Sign.
4. Mary Fonda and her staff have been developing a four page, four-color brochure for three
months. Which item should they be LEAST concerned with including?
A. Client job listing.
B. Photos of award winning projects.
C. Photos of staff members.
D. Text describing design philosophy.
5. The five Ws and an H relate to what you want to say in
A. The six rules of networking.
B. The annual goals.
C. Tips for getting better referrals.
D. A press release.
6. Alice Brown, an interior designer, attended a trade show in Las Vegas to learn more about
products and design standards in the hospitality industry. One of her goals in attending the
69
trade show was to introduce herself to at least 5 people each day who managed small hotels
and motels. In this case, which promotional method is Alice using the MOST?
A. Referrals.
B. Networking.
C. Public relations.
D. Testimonials.
7. Martin Van Waters has used excerpts from letters he received from satisfied clients as part of
the text in his new CD ROM marketing brochure. These excerpts are called
A. Referrals.
B. Testimonials.
C. Statements of qualification.
D. Project objectives.
True False
1. Public relations is about creating an image of the design firm.
2. When the interior designer tells a prospective client about the success of projects for other
clients, the interior designer is using referrals.
3. The PRIMARY reason for networking is to find people to help you.
70
CHAPTER 23: Advanced Promotional Tools
Key Terms
Publication
Newsletters
Case studies
HTML
Requests for proposals (RFP)
Hot button issue
Direct mail
Premiums
Multi-media
Proposals
Short list
Advertising
Discussion Items
•
Name some benefits of using publication of design projects in magazines or other print media
as a promotional tool.
•
Why should you write a query letter before you send an article to a magazine?
•
Why does it seem that clients are receptive to premiums?
•
Describe positive and negative effects of using direct mail techniques for the promotion of an
interior design practice.
71
•
How can a hot button issue be the focus of promotional methods other than RFPs?
•
Describe some hot button issues that can affect marketing to residential design clients; to
hospitality clients; to healthcare; to office/corporate clients.
•
How is a proposal to a RFP different from a design contract?
•
What are some of the benefits to clients of using RFPs?
•
What is the difference between a newsletter and a case study?
•
What is a short list and what does it mean to have "made the short list"?
Sample Questions
Multiple Choice
1. This promotional tool is used by many designers since it allows the designer to show photos
of a project as well as provide a limited amount of text to explain design concepts and
philosophy. It generally does not involve direct costs to place the material.
A. Magazine articles.
B. Advertising.
C. Case studies.
D. Direct mail.
2. You are trying to achieve recognition from potential clients as an expert in a design specialty.
Which method has the potential to give you the widest exposure to potential clients?
A. Writing articles for a state-wide style magazine.
B. Speaking at an interior design association chapter meeting.
C. Writing a column for the local style section of the newspaper.
D. Speaking at a trade market such as Neocon in Chicago, New York, or Los Angeles.
3. This marketing tool is often produced by or with a vendor so that the full cost is not absorbed
by the interior design firm.
A. Newsletter sent to clients.
B. Case study on an important project.
C. Web site for designer.
D. Advertisement for design firm.
4. When a design firm sends unsolicited material to a potential client, the design firm is using
this type of promotional tool.
A. Writing articles for publication.
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B. Internet marketing.
C. Direct mail solicitation.
D. None of the above.
5. The promotional tool costing from less than a dollar to several dollars per item has been very
popular with most businesses but has only recently been used by interior designers.
A. Premiums.
B. Brochures.
C. Direct mail programs.
D. Cooperative advertising.
6. Meredith Smiley has developed a presentation folder in which she inserts color copies of case
studies of completed projects, a sheet listing past clients, and depending on the situation, four
different sheets that explain the design services of her firm. This total package represents
A. The firm's press kit.
B. Her capabilities package.
C. A direct mail package.
D. The firm's RFP proposal format.
7. According to the text, the first consideration in developing an Internet presence for the design
firm is
A. Why the firm wants to have a site.
B. What should be on the site.
C. What links are needed.
D. Who the web master will be.
8. A "hot button issue" is defined as
A. An issue the design firm determines is part of its mission.
B. Critical design needs defined by the client.
C. The buttons that move a viewer around the firm's web site.
D. What the editor of a newspaper is looking for when reviewing an advertisement.
9. ABC Design firm sent information to the local newspaper about the firm. The newspaper
printed the material and later billed the firm. This represents:
A. Advertising.
B. Publicity.
C. Selling.
D. A press release.
True–False
1. Direct mailings should never be done as they are considered unethical.
2. A World Wide Web address is a subset of the Internet.
3. Direct mail is not used as a promotional tool in interior design since clients do not like to get
junk mail.
4. Links are a good idea as part of your web site so your visitor can easily go to related sites.
73
5. A proposal to a RFP provides the same information as a design contract proposal.
6. A small group of design firms the client has decided to interview is called a short list.
7. Any form of paid publication material presented in a newspaper or magazine is called
advertising.
CHAPTER 24: Selling Your Services
74
Key Terms
Selling
Conceptual selling
Prospecting
Cold calling
Qualifying
Probing
Closed probe
Open probe
Features
Benefits
Discussion Items
•
How is selling services different from selling products? Why is it more difficult to sell
services than products?
•
Why are design services considered intangible?
•
What is meant by "a service is perishable"?
•
Discuss some strategies you could use to establish a strong business relationship with a
client.
•
Name the steps in the selling process. Describe key activities in each step.
•
What is meant by "prospecting" as it relates to interior design marketing? Discuss some
methods you would use to prospect for new clients.
•
What is cold calling?
•
If a previously unknown client calls you and asks questions about your firm (but does not
schedule an appointment) is this considered a lead? Why or why not?
•
How would you go about qualifying a prospective residential project client? A commercial
client who is opening an office for a new travel agency?
•
What documents or materials might you want to prepare to make a marketing presentation to
obtain a residential project? A contract for a commercial project such as a hospitality space?
•
What are the four strategy steps in setting up a presentation?
•
What is meant by "asking for the sale"?
•
Prepare three open and three closed probes that you could use in making a presentation to
sell design services; to sell a floor plan layout for a family room; to discuss equipment needs
for a medical office suite.
•
Describe three features and benefits of your interior design services.
75
Sample Questions
Multiple Choice
1. Which sentence does NOT define the differences between selling services and selling
products?
A. Services are intangible while products are tangible.
B. Selling services often involves something that has yet to be produced while selling a
product involves selling something that already exists.
C. The opportunity to sell a service is perishable.
D. Selling products is conceptual since most designers do not have the products in
inventory.
2. Selling services is greatly dependent upon
A. Building a relationship with the client.
B. Determining exactly what the client needs and then providing it.
C. Defined skills that can be learned by even the most introverted individual.
D. All of the above.
3. The process of locating potential new clients is referred to in Chapter 24 as
A. Marketing planning.
B. Prospecting.
C. Qualifying.
D. Probing.
4. Julie has thoroughly investigated her target market. She has determined that there are about
5,000 potential clients for her services within a 5 mile radius of her office. Of those clients, a
minimum of 2,000 are believed to have the economic means to pay for her services. The work
that this information represents can be described as
A. Qualifying potential clients.
B. Cold calling of potential clients.
C. Probing to discover potential clients.
D. None of the above.
5. Which statement is not considered part of the common strategy for the organization of a
presentation?
A. Tell them what you told them.
B. Ask for the sale.
C. Tell them what you are going to tell them.
D. Ask them about their needs.
6. When Sally Roberts asks the client, "Please tell me which employees will be located in this
part of the fifth floor office area?" Roberts is using which selling technique?
A. A closed probe.
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B. An open probe.
C. A trial close.
D. A qualifying question.
True–False
1. Selling a service is selling a deed yet to be performed.
2. Cold calling is a method of prospecting for new clients.
3. Benefits describe specific aspects or characteristics of a product or service.
CHAPTER 25: Design Presentations
Key Terms
Marketing presentations
Feasibility studies
Filler words
Body language
Proposals
Boiler plate
Third-party testimonials
Proposal presentations
Request for proposal (RFP)
Objections
Closing
Trial close
Follow-up
Negotiating
Discussion Items
•
How is a marketing presentation different to an RFP proposal presentation?
•
As you prepare for a marketing or proposal presentation, what kinds of issues would you
anticipate are of key interest from the client's point of view?
•
How is a proposal to an RFP different from a proposal/contract discussed in Chapter 18?
•
Why is it generally considered a bad idea to begin your marketing presentation by showing
the client a selection of project photos or slides?
•
Discuss why it is so important to prepare for a presentation rather than base it on your
experiences and "wing it."
•
Discuss the importance of obtaining client approvals via a signature or initials during the
project presentation.
•
Think of some strategies to use to organize a proposal presentation for a very large hospital
project.
•
Discuss strategies to overcome the objections listed in Figure 25-3.
77
•
Assume you are presenting the documents for the remodeling of a kitchen. Develop several
statements or questions that you could use to "close" and obtain the client's final approval of
the project.
•
Why is it important to find out who will be on the selection committee for a proposal
presentation?
•
What are the advantages and disadvantages of presenting first or last when the client is
seeing three to five firms in the same day?
•
What is meant by a win-win negotiation?
Sample Questions
Multiple Choice
1. Generally, for the designers goals, the most preferable place to hold a presentation is
A. At a restaurant as it is completely neutral.
B. In the conference room at the designer's studio.
C. In a conference room at the client's office.
D. In the client's living room.
2. George Small of Excellent Interiors has asked three previous satisfied clients for a letter
stating their satisfaction with the work that Small did on their projects. Small plans to use
portions of these letters on his company web site. What has Small MOST likely asked for
from his clients?
A. A recommendation.
B. A referral.
C. A testimonial.
D. A proposal.
3. Which of these strategies or tactics would NOT be appropriate when making any kind of
presentation?
A. Using good posture and body language.
B. Criticizing a competing design firm.
C. Using a standardized presentation.
D. Anticipating client questions and being ready to answer.
True–False
1. Using good eye contact shows the client that you are being honest and truthful.
78
2. In-depth estimates of costs for the project are referred to as feasibility studies.
3. It is unethical to try to find out who the members of a corporate selection committee are
prior to arriving to make the presentation.
4. A trial close is simply a method to ask for the sale.
5. The best kind of negotiation always ends in a win-win outcome.
CHAPTER 26: Personal Power
Key Terms
Nonverbal communication
Kinesics
Discussion Items
•
What does the text mean by "giving a gift"? Explain this using examples from outside the
text book examples.
•
Discuss why self-image is important to the success of an interior designer.
•
What body language signals would you look for to help you determine if the client is
interested in your presentation?
•
If you have invited someone to lunch to discuss a business matter–even if the other party is
not a client–who should be responsible for paying the bill?
79
•
With a formal table setting, which bread dish is yours? Which water glass/coffee cup?
What difference does it make?
•
What would you do if a design industry vendor with which you normally do not conduct
business starts sending you email advertisements?
Sample Questions
Multiple Choice
1. The BEST outfit to wear when presenting to a commercial client.
A. Casual pants or slacks with a short-sleeved polo shirt.
B. A traditional navy blue suit.
C. A contemporary cut light gray suit.
D. It depends on the exact situation and client.
2. Martin has been noticing that his seated client has been turning his body toward the
conference room door, which is on a wall at right angles to the screen Martin is using for his
presentation. However, the door is closed. Interpreting these movement using body
language, what does this MOST likely mean?
A. The client is possibly loosing interest.
B. The client wants to leave the room.
C. It means nothing of importance.
D. The client is just moving his chair back and forth like most people might.
3. This body language signal describes a client who considers himself or herself in a powerful
position.
A. Folding arms across the chest and tightly gripping the arms with the hands.
B. Tightly crossed legs while facing the exit.
C. Slouching in the chair while pushing slightly away from the conference table.
D. Placing the fingertips together to create a triangle with the hands.
4. In general, what is the MAIN purpose for having a meeting with a client at a restaurant?
A. Review plans and products with the client you wish to use for the project.
B. Negotiate delicate issues concerning the contract.
C. Show an affluent client that you have good table manners.
D. Continue to develop rapport with the client.
5. The best way to indicate you are done eating and wish the waitstaff to clear your plate is to
A. Place your napkin, folded neatly, in the center of your plate.
B. Place both the knife and fork in the center of the plate with the handles on the right of
the plate.
C. Move the plate to the center of the table so that it is easier to place documents in front
of you.
D. All of the above are correct etiquette.
True–False
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1. Powerful language is assertive and conversational.
2. When you are visiting a job site under construction, it is permissible to wear casual cloths
such as jeans and a sport shirt.
3. Accessorizing your work outfits should add a final touch–not "speak louder" than you.
4. In a general sense, a good fitting garment is more important than the actual cost.
5. Robert was having a lunch meeting with his client at a well known restaurant. His client
ordered a mixed drink. It would be fine for Robert to also order a drink in order to be
sociable, regardless of company policies on drinking.
CHAPTER 27: Project Management Techniques
Key Terms
Project management
Deliverables
Programming phase
Schematic design phase
Design development phase
Contract documents phase
Contract administration phase
Project file
Single source of contact
Value engineering
Work plan
Transmittal letter
80/20 rule
Time records
Milestone charts
Bar charts
Critical path method (CPM)
Stakeholder
Ball-park budget
Discussion Items
•
Why is project management an important function of the responsibilities of an interior
designer?
•
Define the phases of a design project and define the activities in each phase.
•
Explain some of the deliverables that are common to a residential design project. Also
explain the deliverables that are common to a commercial project for a large office complex.
•
What is the purpose and use of the work plan?
•
What does the acronym "CD's" refer to? In which project phase are these developed?
•
Discuss the stakeholders involved in a project for the remodeling of a residential kitchen and
addition of a family room to an existing house (or any other type of residential project).
81
•
Discuss who the stakeholders might be for the design of an assisted living facility owned by a
group of physicians (or any other type of commercial facility).
•
What are the advantages and disadvantages of using a bar chart over a CPM schedule for a
restaurant remodeling project?
•
How is a milestone chart different from a bar chart?
•
Explain the three project budgeting techniques discussed in the text.
•
Explain the 80/20 rule as it is applied to the interior design profession.
•
How often should "to-do-lists" be prepared? Why is it important to prepare to-do-lists?
•
Why are time records kept? Give at least three reasons and explain the significance of time
records in interior design project management.
•
What kinds of information and/or forms should be kept in a project file? Why is it important
for all information placed in the project file to be dated?
• Explain how value engineering can help satisfy a client's need for budget control.
Sample Questions
Multiple Choice
1. According to the text, a successfully managed project is MOST recognized when which
scenario occurs?
A. The client has a successful open house.
B. The client's problem has been solved.
C. The designer has made a reasonable profit.
D. The vendors have asked the designer to co-op advertising.
2. You are at the stage of preparing preliminary sketches of a floor plan and making early
selections of the products to be specified for a project. You are in what phase of the design
project?
A. Programming.
B. Schematic.
C. Design development.
D. Construction documents.
3. Final decisions on the FF&E are made in this phase of the project.
A. Programming.
B. Schematics.
C. Design development.
D. Contract documents.
4. The project work plan and list of needed deliverables are prepared in this phase of the design
project.
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A.
B.
C.
D.
Programming.
Schematics.
Design development.
Contract documents.
5. Which of these individuals would most likely NOT be a stakeholder in the remodeling design
of bed and breakfast facility?
A. Owners.
B. Employees.
C. Interior designer.
D. Former guests.
6. The scheduling system that shows which tasks must be completed before the next task can be
started.
A. Critical path schedule.
B. Bar chart schedule.
C. Time record schedule.
D. Project management schedule.
7. The scheduling chart that is the easiest to prepare.
A. Milestone chart.
B. Bar chart.
C. GNT chart.
D. CPM chart.
8. The main reason for keeping time records.
A Establish marketing criteria for the yearly marketing plan.
B. Make sure your boss pays you the right salary.
C. Show the client how hard you are working on their project.
D. Insure reasonable and fair compensation for the designer.
9. This statement MOST accurately portrays the meaning of the 80/20 principle.
A. In a list of items, 80% of the value of one's time is obtained from 20% of the items.
B. It is a ratio important in determining the utilization rate of designers.
C. In a list of 80 items of work required on a project, 20 of those items will be
nonbillable activities.
D. It is a ratio used to review gross margin. Eighty represents net profit while the 20
represents gross expenses.
10. This is used to store all the information about a particular job.
A. Job book.
B. Job schedule
C. Personnel file.
D. Vendor file.
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11. The correspondence item MOST often used to accompany drawings or samples is called a
A. Transmittal letter.
B. Intra-office memo.
C. Cover letter.
D. Acknowledgment.
True–False
1. The bidding process occurs during the contract documents phase of a project.
2. Anyone who has a financial or employment interest in a project can be referred to as a
stakeholder.
3. Unless the client is the general contractor, he should not be giving instructions to
subcontractors during the construction and installation work.
4. The single source of contact for a commercial project will always be the chief executive of
the company.
5. The easiest method of representing the project schedule is by use of the bar chart.
6. Using quality ranges is the BEST method of producing a project budget for any type of
interiors project.
7. Time records help the manager oversee the progress of projects, even when the client is not
being billed by the hour.
8. Historical time records are very important to help a designer estimate future similar projects.
9. One of the MOST important habits to have in terms of controlling a design project is
consistent recording of notes and other communications.
CHAPTER 28: Working with Trade Sources
Key Terms
Trade sources
Vendor
Representatives
Manufacturer's dealer
"Reps"
Showrooms
Market center
Mart
Showroom
Independent reps
Factory reps
Trunk show
General contractor (GC)
Subcontractors (subs)
Change orders
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Market
"Buying a job"
Construction manager
Discussion Items
•
Why are trade sources important to the interior designer?
•
What is the difference between an independent rep and manufacture's rep?
•
What kind of information can the reps provide to designers?
•
Discuss what kinds of activities occur at one of the major markets held during the year.
•
Explain mart and trade showroom access policies.
•
Discuss how manufacturers, sales representatives, showrooms, and tradespeople help the
interior designer.
•
How do retail specialty shops assist the interior designer?
•
How can an interior designer determine the quality of a trades or craftsperson?
•
Why is it necessary for the client to understand how contractors work on the job site?
•
Discuss how on-line libraries are affecting or will affect the interior designer in the next five
years.
Sample Questions
Multiple Choice
1. Vendors can best be described as
A. Anyone that sells merchandise or services in the interior design industry.
B. Manufacturers who sell only to interior designers and others in the industry.
C. Manufacturers who only sell to those in the trade.
D. Sub-contractors who are hired by general contractors.
2. A "Representative" is someone who
A. Acts as the informational source from manufacturers to the client.
B. Can quote special pricing to the designer when needed.
C. Only works for one manufacturer.
D. Works or "represents" the client's interests.
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3. This term relates to the space used by a manufacturer to display its products to the trade.
A. Market center.
B. Showroom.
C. Mart.
D. Retail store.
4. A closed showroom is one in which
A. Only the trade may access.
B. Allow clients of designers access.
C. Only interior designers may access.
D. Never allow clients access.
5. A type of trade source that is privately owned yet primarily sells the products of one or
only a few select manufacturers is called a
A. Factory rep.
B. Market.
C. Dealer.
D. Retailer.
6. Mike Smith has decided to offer an exceptionally low price on a bid for furniture for a hotel
lobby. He hopes that this will bring him additional work in the future with the hotel and/or
the interior designer. Which phrase describes the tactic that Mike Smith is using?
A. Closed bidding.
B. Good target marketing tactics.
C. Unethical practice in pricing.
D. Buying the job.
True–False
1. Factory reps usually sell products from one than one manufacturer.
2. A drapery work room and paperhanger are considered to be subcontractors.
3. An interior designer can be considered a vendor.
4. A "trunk show" refers to the mini programs conducted at market shows in individual
showrooms.
5. The general contractor is MOST commonly hired by the interior designer to oversee
construction work for a project.
6. Subcontractors are often hired by the general contractor to complete specific portions of the
project.
7. On-line libraries of trade sources hurt the interior designer since clients can buy directly
from them.
86
CHAPTER 29: Contract Documents and Specifications
Key Terms
FF & E
Contract documents
Movable equipment
Construction documents
Schedules
Specifications
"Specs"
Modifications
Addenda
Change orders
Closed specification
Open specification
Proprietary specification
Bid bond
Performance bond
Labor and materials payment bond
Mechanics lien
Bid list
Base bid
Construction drawings
"Or equal" clause
Descriptive specification
Performance specification
Reference specification
Competitive bidding
Invitation to bid
Open competitive selection
Closed competitive selection
Instructions to bidders
Bid forms
Bond forms
Bid opening
Submittals
General conditions
Knockoff
Discussion Items
•
What is the difference between contract documents and construction documents?
•
What does the acronym FF & E stand for? How do these elements relate to the work of the
interior designer?
•
For equipment plans, is it better to use generic or trade names to identify products? Explain
your answer.
•
Explain the different schedules that are included in a set of construction documents.
•
Explain the difference between an open and closed specification. Give an example of each.
•
What is a "base bid"? Is a base bid any different from a closed or an open specification?
•
What does it mean when an equipment specification uses the term "or equal" as part of the
specification?
•
What are the advantages of the proprietary specification?
•
Describe the advantages and disadvantages of the descriptive specification for a furniture bid.
87
•
Explain the advantages and disadvantages of a performance specification.
•
Explain the purpose of the Construction Specification Institute (CSI) and explain how the
CSI specification organization is of assistance to the designer.
•
What is the primary purpose of the competitive bid process?
•
There are a few disadvantages of the bid process. Explain them.
•
What is the purpose of the invitation to bid, the instructions to bidders, and the bid form?
•
What are the differences between open and closed competitive selection?
•
Describe the uses of the bid bond, performance bond and labor and materials payment bond.
Include a discussion of the values attached to each bond and who is responsible for obtaining
each kind of bond.
•
You are reviewing a bid document set prepared by some other design firm. You notice
several discrepancies between the drawings and the specifications. What should you do?
•
Explain the use of addenda and the kinds of information that might be covered by their use.
•
Discuss the difference between addenda and a change order. When are change orders used?
•
Why might a designer file a "mechanics lien?" Who is this lien field against and why?
•
What are submittals? Give an example of a submittal related to furniture and one related to
design documents.
Sample Questions
Multiple Choice
1. This document is NOT part of contract documents.
A. Architectural drawings, including furniture plans.
B. Schedules for lighting and wall finishes.
C. Written specifications concerning build-out.
D. Communications between GC and sub.
2. You placed the following statement in the specifications for a bank project. "Lobby seating
shall be by Knoll Inc., and vendors may NOT substitute specified products." This statement
represents which type of specification?
A. Closed specification.
B. Open specification.
C. Reference specification.
D. Performance specification.
88
3. If the following appeared in a set of specifications, "All items are base bid. No substitutes or
alternates will be accepted." What kind of bid specification has been written?
A. Proprietary.
B. Performance.
C. Reference.
D. Descriptive.
4. Specifications
A. Are the written instructions to the contractors.
B. Are generally descriptions of the required duties of the subcontractors.
C. Tell the client what he or she is expected to do during the project.
D. Explain what the responsibilities of the architect will be.
5. This type of specification is written to clarify in specific detail, such things as the fabrication
methods and materials required to make or build a product or the interior finishing.
A. Performance specification.
B. Proprietary specification.
C. Descriptive specification.
D. Reference specification.
6. The term "base bid" is MOST associated with
A. A proprietary specification.
B. A performance specification.
C. A descriptive specification.
D. A reference specification..
7. This document notifies potential bidders of the existence of a project/bid.
A. General conditions.
B. Invitation to bid.
C. Instructions to bidders.
D. Bid form for bidders.
8. "Bids will be due on or before September 15, 200x at 4:00 PM. Bids are to be delivered to
the Purchasing Department, City of Phoenix, at the Municipal Building at 205 W. Thomas,
Phoenix, Arizona." That statement would MOST likely appear in which of the documents?
A. General conditions.
B. Instructions to bidders.
C. The performance bid.
D. Construction documents.
9. This form guarantees that the vendor will complete the work as specified.
A. Bid bond.
B. Performance bond.
C. General conditions.
D. Labor and materials bond.
10. This particular form is a legal recourse to insure payment from the client to the designer.
89
A.
B.
C.
D.
Mechanics' lien.
Performance bond.
Labor and materials bond.
Bid bond.
11. Robertson's Paint and Wallpaper has been notified that the company has won the bid to
provide all paint and wallpaper installation for the new criminal courts building in Nashville,
Tenn. Mr. Robertson, the owner, must now obtain which bond?
A. Bid bond.
B. Labor and materials bond.
C. Project bond.
D. Mechanics bond.
12. General Motors Corporation conducted a bid for a new research center in Detroit. Over 75
bidders were provided with the bid documents. These vendors were those General Motors
had received bids from in the past. Which answer best defines the kind of bid process that
occurred?
A. Closed competitive bid.
B. Open competitive bid.
C. Public bid.
D. An illegal bid.
13. "Addenda" is a document most associated with:
A. The bid process.
B. Design development.
C. The scheduling process.
D. Schematic design.
14. Mary discovered a error in the floor plans after the contract to order custom cabinets for a
client had been awarded to a cabinet company. Which document should Mary use to convey
the necessary changes to the cabinet company?
A. An addenda to correct the problem.
B. A change order to correct the problem.
C. Modify the purchase order.
D. Modify the design contract.
15. Ann is the project designer for the restoration work on a historic commercial building in
downtown Iowa City, Iowa. She has asked the company, which will provide custom
fabricated tin ceiling material for the interior of the building, to send her a sample of the item
they will provide. Considering the terms used in the text, what is the term for the item she is
asking the vendor to supply?
A. Change order.
B. Bid bond.
C. Submittal.
D. Transmittal.
True–False
90
1. To keep things clear on contract drawings, it is more acceptable to use trade names for
products than generic names.
2. If there was a discrepancy between the drawings and the specifications in the contract
documents, the courts MOST commonly determine that the specifications are accurate.
3. Schedules in contract documents can be either written information or graphic information.
4. Specifications are used to communicate the project requirements to the vendor or contractor.
5. A performance specification establishes criteria of the seller's performance that is
measurable.
6. The bid form is the document that the vendor uses to inform the client of the bid price.
7. Bid openings are always open to the public.
8. The general conditions document sets forth legal responsibilities during a competitive bid.
9. A reference specification uses an established standard for specifying goods.
10. Instructions to bidders tells the vendor when, where and what form the bid must be made.
CHAPTER 30: Contract Administration
Key Terms
Building permits
"Red line"
Progress reports
Movable equipment
Terms and conditions of sale
Line item number
Customer's own material
Open purchase order file
Concealed damage
Project manager
Plan check
Move management
Capital construction
Back orders
"Tag for"
Expediter
Drop ship
Building permit
Box burns
Order Processing Forms
91
Credit application
Confirmation of purchase or
Purchase agreement
Purchase order (PO)
Freight bill
Acknowledgment
Invoice
Bill of lading
Packing list
Change orders
Discussion Items
•
Describe the activities that occur during the contract administration phase of a project.
•
What is the difference between capital improvements and movable equipment? Which is the
interior designer most often responsible?
•
Why is it important to have a client fill out a credit application before ordering for or
contracting with the client?
•
What is the purpose of a confirmation of purchase? What information must be on it?
•
Why should the client sign the confirmation of purchase?
•
What are the different functions of the purchase order?
•
Understand all the necessary items that are customarily a part of a purchase order.
•
Can orders for merchandise be made via facsimile or email? Is this a good idea? What
should you do to have a proper paper trail when using electronic means of ordering
merchandise?
•
Why is it important for PO's to have sequential numbers?
•
What different information is required on a purchase order if you order an upholstered item
"COM?" How many PO's would be needed?
•
•
If you order merchandise from four different suppliers for the same client, how many
PO's must you send out?
A minimum of 3 copies of a PO are required. Which copy goes to whom or where?
•
What information does the acknowledgment relay to the designer?
•
About how long does the designer have from the time the acknowledgment is received to
change or cancel an order?
•
What is the purpose of an invoice? Who sends invoices?
•
What information will be found on an invoice from a manufacturer?
•
What information should you include on your invoices to clients?
92
•
Which form is carried by the freight truck driver?
•
What is a bill of lading and what information is on it?
•
What information is on a packing list?
•
What should be done if merchandise has been damaged in transit from the factory? What if
is was concealed damage?
•
What information is necessary to file a freight claim?
•
What are the duties of an expediter, as discussed in the chapter?
Sample Questions
Multiple Choice
1. Your project responsibilities for a Sweet Taste Coffee Shop involves the specification of
interior finishes, flooring materials, movable furniture, and accessories. Which document or
procedure do you NOT need to obtain for this project as relates to YOUR responsibilities?
A. Construction drawings and equipment plans.
B. Building permit before architectural finishes are installed.
C. Design contract to clarify your responsibilities.
D. Plan review by the city where the coffee shop is located.
2. Barbara is involved in the design of a new pediatrics wing of a hospital. The hospital has had
two different design firms involved with the project. Barbara's responsibility was to
coordinate the seating in the patient rooms and the family rooms while another firm was to
work with Barbara to coordinate architectural finishes. Barbara's responsibility focused on
A. Capital improvements.
B. Movable equipment.
C. Capital construction.
D. Tenant improvements.
3. A form used by many designers to obtain information about the prospective client who
wishes to special order goods is called a(n)
A. Confirmation proposal.
B. Better business report.
C. Invoice.
D. Credit application.
4. This should be signed by your client prior to ordering any furniture
A. Purchase agreement.
B. Purchase order.
C. Invoice.
D. Acknowledgment.
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5. This form will have both the manufacturer's order number and the designer's purchase order
number on it to help the designer keep track of the order.
A. Acknowledgment.
B. Purchase order.
C. Invoice.
D. Packing list.
6. On a purchase order, the "tag for" space is used to identify
A. The client.
B. The vendor.
C. The total price of the project.
D. The design firm.
7. The form you send to manufacturers or subcontractors to obtain goods or services.
A. Purchase order.
B. Acknowledgment.
C. Invoice.
D. Confirmation of purchase.
8. Mr. Rogers has ordered several pieces of furniture or the new offices for Mr. Barney.
Included in the order are two sofas from Knoll with Maharam fabric and a conference table
from Heibert International. Which is correct?
A. The designer needs to prepare one purchase order.
B. The designer needs to prepare two purchase orders.
C. The designer needs to prepare three purchase orders.
D. The designer needs to prepare four purchase orders.
9. This is commonly used when the interior designer purchases items such as stationary on
credit.
A. Acknowledgment.
B. Invoice.
C. Purchase order.
D. Transmittal.
10. Special discounts given by manufacturers to the designer will be shown on the
A. Invoice.
B. Purchase order.
C. Freight bill.
D. Confirmation of purchase.
11. This is sent to the designer at approximately the same time the merchandise is shipped
A. Invoice.
B. Acknowledgment.
C. Agreement.
D. Purchase order.
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12. The form that tells the customer how much is due and payable.
A. Purchase order.
B. Acknowledgment.
C. Invoice.
D. Progress report.
13. It is very important to check this form to be sure that the correct merchandise was ordered.
A. Transmittal.
B. Invoice.
C. Acknowledgment.
D. Freight bill.
14. This goes with the truck driver when the goods are shipped from the factory to the designer.
A. Bill of lading.
B. Invoice.
C. Freight bill.
D. Packing list.
15. A detailed list that comes with the merchandise. It should be checked against the bill of
lading at the time of receipt of goods.
A. Packing list.
B. Purchase order.
C. Acknowledgment.
D. Invoice.
16. As furniture items are off-loaded from a shipper's truck, you notice a damaged piece of
furniture. You should
A. Refuse the item.
B. Tell your repairmen to fix it.
C. Make note of the damage on the bill of lading.
D. Note the damage on the packing list.
17. A type of damage that occurs on furniture items when the packaging rubs against the
furniture and causes some sort of discoloration of the wood.
A. Box burn.
B. Inconsequential damage.
C. Accidental damage.
D. Wood burn.
18. A job title which is MOST associated with the responsibility of tracking orders that have
been placed for clients.
A. Expediter.
B. Designer.
C. Warehouse person.
D. Facilitator.
95
True–False
1. Plans that you had prepared by a consulting architect are returned from the city with a large
number of red marks on them. This is called red-lining and means the project cannot be built
as originally drawn.
2. Freight claims must be initiated at the time goods are taken off the shippers truck by making
notations related to the damage on the bill of lading.
3. Concealed damage is damage hidden from the designer or warehouseman by the client until
after the invoice comes.
4. As described in the text, an expediter is an individual responsible for the speedy processing
of the manufacturer's orders.
5. An invoice is simply a bill that is used by the designer to bill clients or for a supplier to bill
the designer for merchandise ordered for a client.
6. A line item number helps the warehouse service track which order is for which different
client.
7. Damages to goods that occur after the merchandise has arrived at the job site but before the
client takes official ownership, are the responsibility of the design firm/delivery company.
96
CHAPTER 31: Contract Administration: Delivery and Project Closeout
Key Terms
Delivery
Installation
Walk-through
Project closeout
Certificate of substantial completion
Record drawings
Certificate for payment
Cartoning
Punch list
Postoccupancy evaluation (POE)
Site inspection report
Certificate of occupancy (CO)
As-built drawings
Retainage
Discussion Items
•
Why is it important to have a client sign for delivery of goods?
•
Describe the differences between delivery of goods and the installation of goods.
•
Describe the different types of activities that occur during project closeout.
•
What is the purpose of a walk-through? What form is used as part of a walk-through?
•
Is the site inspection report any different from a punch list?
•
What is a certificate of substantial completion? Is it commonly used for the interiors portion
of a project?
•
The certificate of occupancy is issued to whom?
•
What is the difference between the construction drawings and as-built drawings?
97
•
Explain "retainage" and who it most commonly affects.
•
What is the purpose of a POE?
•
Which activities are included in the follow-up part of a design project?
Sample Questions
Multiple Choice
1. This form is signed by the client to signify acceptance of the merchandise when it arrives at
the project site.
A. Sales confirmation.
B. Delivery ticket.
C. Punch list.
D. Acknowledgment.
2. The furniture and accessory items for the public areas of a hospitality project that Stephen
White designed are now being delivered. Tomorrow, the client will tour the spaces with
White to make sure everything is finished before the opening in two days. This part of the
design project is referred to as
A. Project closeout.
B. Contract administration.
C. Occupancy review.
D. None of the above.
3. For a large commercial project ,such as a hospital acute care unit, the interior designer would
provide this form to the client after the punch list is completed.
A. Certificate of occupancy.
B. Certificate of retainage and completion.
C. Certificate of substantial completion.
D. Certificate of change.
4. Lisa Miller, the purchasing manager for a large electronics firm, informed Jennifer Springs,
the interior designer that she will only authorize 95% of payment for all bills due on the
project. This was stated in Miller's original purchase order to Springs. Holding back a
percentage of payment is referred to as
A. Breach of contract.
B. A retainer.
C. A modification.
D. Retainage.
98
5. This is done a few weeks or more after the project is completely installed and the client has
taken ownership of the project. It's purpose is to clarify client satisfaction with the
installation.
A. Post-occupancy evaluation.
B. Walk-through.
C. Job addends.
D. Expediting.
True–False
1. A punch list provides the interior designer a list of what is missing and/or needs repairs at
the end of the project.
2. The site inspection report is essentially the same thing as a punch list.
3. A postoccupancy evaluation is done ONLY to advise the client of what activities were not
successfully accomplished during the course of the project.
CHAPTER 32: Career Options
Discussion Items
•
Discuss some of the key decisions a student must make in determining which design
specialty to pursue.
•
What considerations might affect a professional's choice of moving from one design specialty
to another?
•
What factors make residential interior design different from commercial interior design
practice?
•
Describe the general working conditions of five career options that hold some interest to you
at this time.
•
Describe the employment option you are most interested in pursuing after graduation.
99
•
How is working for a specialized independent design firm different from a retail store and an
office furnishings dealer?
•
Discuss what out-of-class activities might be of benefit to a student seeking a position in
residential design as well as a commercial design specialty, such as hospitality design or
health care design.
Sample Questions
There are no sample multiple choice or true–false questions for this chapter. The author believes
this is an informational chapter, not one in which testing content is necessarily of value.
CHAPTER 33: Getting the Next–or First–Job
Key Terms
Portfolio
Resume
Chronological resume
Functional resume
Combination resume
Cover letter
Career summary
Career objective
References
Scanning (related to resumes)
Informational interview
Headhunters
100
Key words
Discussion Items
•
What is the purpose of a portfolio?
•
Why is it important for the portfolio to contain examples of all the skills the designer
possess?
•
What is it meant by the concept that a portfolio should never be considered "finished"?
•
What are some considerations in the use of PMTs for inclusion in a portfolio?
•
Why might you want to consider using a CD-ROM disk for a portfolio rather than one of the
traditional formats?
•
What is the purpose of a resume?
•
What are the advantages/disadvantages of the chronological format over the functional
resume format?
•
What is the difference between the career summary statement and career objective in a
resume?
•
Discuss some of the technical differences in preparing a "paper" versus an electronic resume.
•
Develop a list of at least 15 key words that might be used in the "key words" section of an
electronic resume for a residential designer; for a commercial designer–entry level.
•
What is the appropriate protocol in listing former professors or employers as references with
your resume?
•
What should you do if you do not want the employer that is currently interviewing you to
contact your current or previous employers for a reference?
•
Discuss the purpose of an informational interview and how to go about getting prepared
to conduct one.
•
Discuss some of the ways you can find out about possible job openings in your area of
interest (and geographic location) of interior design.
•
What is the purpose of a cover letter?
•
How can a "headhunter" help in the job hunting process?
•
What key issues should be presented in a cover letter?
101
•
What are some factors that employers use as they review resumes and cover letters? (This
is a generic question as the actual factors will vary from employer to employer based on
his or her needs).
•
What should you do to prepare for a job interview?
•
What kinds of things about you is the employer trying to find out during a job interview?
•
Discuss what an applicant can do if he or she is asked discriminatory questions on a job
application or during a job interview.
•
Prepare your answers to the questions shown in Figure 33-12.
•
Why is the first job in interior design so important to your long range career goals?
Sample Questions
Multiple Choice
1. Which of these items is LEAST likely to be included in your portfolio?
A. Project work from the last studio class in your academic program.
B. A clean copy of the your resume.
C. Sketch work from a beginning drawing class.
D. A partial set of dimensioned working drawings.
2. How many items should you include in your portfolio?
A. A sufficient number to show all your skills, regardless of the type of job for which
you are applying.
B. Only those items that specifically relate to the job for which you are applying.
C. Only those items that are the very best work that you have done in your studio
classes.
D. A selection of work, good and bad, that shows your growth in skills and abilities as a
designer.
3. The LEAST important information on a resume.
A. Educational background.
B. Work experience in chronological order.
C. Personal information like marital status and hobbies.
D. A list of names of your references.
4. This type of resume reports all the information in reverse order with the most recent first.
A. Functional.
B. Chronological.
C. Reference.
D. Combination.
102
5. The most important information on a resume that the majority of students will want to
communicate.
A. Work experience.
B. Career summary.
C. Education.
D. References.
6. This type of job search assistance is BEST used by professionals with several years of
experience.
A. Placement offices.
B. Referrals.
C. Executive search companies.
D. Good friends in the business.
7. A cover letter is used
A. To draw attention to specific information in your resume.
B. Introduce yourself to a prospective employer.
C. Show the prospective employer that you know something about his company.
D. All of the above.
8. The item of information that employers are LEAST interested in and will surely not help a
student applicant obtain an interview.
A. Comments about the applicant's interest and experiences that will show how he or she
would fit into the design firm.
B. Industry jargon and language that makes the applicant sound too good to be true.
C. Using the name of a professor or design professional that referred the student to the
design firm.
D. Resumes and cover letters using writing skills and language which sound like the
student is overly confident in his or her abilities.
9. Which activity is MOST important to help you ensure a positive interview experience?
A. Arrive on time.
B. Be prepared.
C. Dress appropriately.
D. Know what salary you want.
10. It is permissible for the employer to ask
A. Your date of birth.
B. If you are married or single.
C. If you are between the ages of 18 and 35.
D. If you have any children.
True–False
1. On a resume, the career summary statement explains what kind of job you want to have.
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2. There is no difference in the writing style and format of a resume sent by electronic means
than one sent through the mails.
3. The functional resume emphasizes qualifications and skills rather than when and where they
were obtained.
4. A resume should be long enough for the applicant to fully explain all the experience and
skills that relate to the job, no matter how many pages that may take.
5. A cover letter is the applicant's opportunity to introduce himself or herself and entice the
employer to carefully read the attached resume.
6. Since interior design is a creative profession, the more creative the resume and cover letter
physical appearance, the more likely the applicant will be to obtain an interview.
7. There is really nothing you can do if you feel you have been discriminated against because
of the answers you gave to questions during a job interview.
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