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Managing Projects > Managing Projects - Week 4 / Project Cost Management > Flashcards

Managing Projects - Week 4 / Project Cost Management Flashcards

1
Q

completion on _____ and within _____ are the main deliverables for any project?

A

Time, budget

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2
Q

Cost management involves four key processes?

A
  • PLAN cost management
  • ESTIMATE costs
  • DETERMINE budget
  • CONTROL costs
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3
Q

Used as the framework for all cost management activities?

A

WBS (Work Breakdown Structure)

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4
Q

Process of defining how the project costswill be estimated, budgeted, managed, monitored, and controlled

A

Plan Cost Management

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5
Q

One of the key information sources that needs to be created?

A

Schedule of Quantities

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6
Q

Determine what physical resources need to beapplied to enable identified items of work to be completed

A

Historical Data

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7
Q

Process of developing an approximation of themonetary resources needed to complete project work

A

Estimate Cost

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8
Q

Process of aggregating the estimated costs of individual activities or work packages to establish an authorised cost baseline?

A

Determine Budget

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9
Q

Costs allocated to activities can be grouped into?

A

Cost Centres

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10
Q

Cumulative project costs typically exhibit an ___ profile, indicating slower production at the start and end of projects?

A

S-Curve

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11
Q

Monitoring the status of the project to update the project costs and manage changes to the cost baseline?

A

Control Costs

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12
Q

Control Cost includes:?

A
  • Monitoring
  • Ensuring
  • Preventing
  • Informing
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13
Q

Increases with time and project resolution?

A

Estimating Accuracy

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14
Q

Estimates may be analogous (top-down) based on?

A

Historical Data

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15
Q

Bottom-up based on detailed pricing of activities, or a combination of the two?

A

Detailed Pricing Activities

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16
Q

Estimates may also be prepared using?

A

Parametric Modeling

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17
Q

Types of costs?

A
  • Direct (Project Activity)
  • Indirect (Administrative)
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18
Q

Types of costs can be:?

A
  • Finance
  • Labour
  • Materials
  • Production equipment
  • Planning Procurement
  • Transportation
  • Marketing
  • Contingencies
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19
Q

Lists out the magnitude of work items as defined in the scope of work?

A

Schedule (or bill) of Quantities

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20
Q

How cost variances will be managed?

A

Cost Management Plan

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21
Q

Set of procedures and principles for effective cost management?

A

Cost Management Plan

22
Q

Estimating can involve a combination of?

A
  • Historical evidence
  • Current market information
23
Q

Allowances for unresolved or unknown conditions, or as a buffer to account for unexpected circumstances?

A

Contingencies

24
Q

Decisions about contingencies is called?

A

Reserve Analysis

25
Q

Commonly used to describe all the costing processes that occur prior to commencement of the scope of the work (i.e. during the design process)?

A

Cost Planning

26
Q

Term applied to the cost of finance to cover these periods of cash shortfall?

A

Working Capital

27
Q

More time =?

A

Higher project expenses

28
Q

A result in the time lag necessary to assess progress and make payment?

A

Cash Fluctuations

29
Q

Monies held back by the project sponsor to ensure timely completion?

A

Project Retention

30
Q

For late completion?

A

Liquidated damages

31
Q

For poor quality work or mistakes will all impact on the liquidity of the project?

A

Restoration Costs

32
Q

Required to fill in any shortfalls and ensure that all creditors and employees are paid?

A

Working Capital

33
Q

Measure of work performed expressed in terms ofthe budget authorised for that work?

A

Earned Value (EV)

34
Q

Result of cost estimating activities, the assessment of profit and risk and its integration with the project schedule?

A

Project Budget

35
Q

It is important that the agreed cost baseline is both ____ and _____?

A

Realistic, achievable

36
Q

Project costs will change with time due to the effects of _____ in the national economy?

A

Inflation

37
Q

Who determines project priority?

A

Project Sponsor

38
Q

When does the project priority usually change?

A

Near the end of the project

39
Q

Gap between general inflation and specific escalation is known as?

A

Differential Escalation

40
Q

Documents used to request payment?

A

Invoices

41
Q

Used to record the progressive invoices that may be received for a single package of work?

A

Invoice Control Sheet

42
Q

Percentage of the net transaction for the work, and is added to and becomes part of the invoice total?

A

Goods and Services Tax (GST)

43
Q

Cost estimating and budget preparation can be done using?

A

Life Cycle Cost

44
Q

When equating past, present or future costs within a comparative decision process, the costs need to be first converted into their?

A

Equivalent Values

45
Q

Drawbacks to spending less money?

A
  • Project time may not necessarily reduce as expected
  • Quality of finished work falls
  • Achieving agreed scope of work may come under pressure
  • Additional risk
  • Larger contingency
46
Q

Something that needs to be balanced for overall project performance maximised?

A

Costs

47
Q

Process you will use to capture cost estimates:?

A
  • Use the WBS to guide cost estimating
  • Use bottom-up estimates
  • Meet stakeholders
  • Validate cost estimates
  • Identify, analyse and treat cost related risks
  • Create a budget
  • Submit approval
48
Q

Budgeting

A
  • Form of communication
  • WBS guides
  • Design budget and group together
49
Q

Budgeting Processes

A
  • Bottom-up estimates
  • Work packages
  • Present management
50
Q

Cash Flow Chart

A
  • INFLOWS (cash flowing in project)
  • Outflows (cumulative cash expenditures)
  • Purpose (how PM use the cash flow chart?)

Managing Projects (3 decks)

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