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PMP Exam > Project Cost Management > Flashcards

Project Cost Management Flashcards

1
Q

Name the project cost management processes

A

Plan cost management
Estimate costs
Determine budget
Control costs

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2
Q

What is plan cost management

A

The process that establishes the policies, procedures, and documentation for planning, managing, expending, and controlling project costs

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3
Q

Key benefit of plan cost management

A

It provides guidance and direction on how the project cost will be managed throughout the project

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4
Q

Plan cost management inputs

A

Project management plan
Project charter
Enterprise environmental factors
Organizational process assets

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5
Q

Plan cost management tools and techniques

A

Expert judgment
Analytical techniques
Meetings

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6
Q

Plan cost management outputs

A

Cost management plan

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7
Q

What is estimate cost process

A

The process of developing an approximation of the monetary resources needed to complete project activities

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8
Q

Estimate costs key benefit

A

It determines the amount of cost required to complete project work

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9
Q

Estimate costs inputs

A 
Cost management plan
Human resource management plan
Scope baseline
Project schedule
Risk register
Enterprise environmental factors
Organizational process assets
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10
Q

Estimate costs tools and techniques

A 
Expert judgment
Analogous estimating
Parametric estimating
Bottom up estimating
Three point estimating
Reserve analysis
Cost of quality
Project management software
Vendor bid analysis
Group decision-making techniques
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11
Q

Estimate cost outputs

A

Activity cost estimates
Basis of estimates
Project documents updates

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12
Q

Rough order of magnitude

A

-25% to 75%

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13
Q

When is analogous estimating used

A

When there is limited amount of detailed information about the project

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14
Q

What are contingency reserves

A

The part of the budget intended to address known unknowns. They are part of the cost baseline and overall funding requirements

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15
Q

What are management reserves

A

The amount of project budget withheld for management control purposes that are intended to address unknown unknowns. They are not included in the cost baseline but are part of the overall project budget and funding requirements

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16
Q

What are activity cost estimates

A

Quantitative assessments of the probable cost required to complete the project

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17
Q

What is the basis of estimates

A

Supporting details for activity cost estimates.

Includes
Documentation for basis of the estimate
All assumptions made
Any known constraints
Indication of the range of possible estimates
Indication of confidence level of the estimate

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18
Q

What is the determine budget process

A

Process of aggravating the estimated cost of individual activities or work packages to establish an authorized cost baseline

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19
Q

Determine budget key benefit

A

It determines the cost baseline against which the project performance can be monitored and controlled

20
Q

Determine budget inputs

A 
Cost management plan
Scope baseline
Activity cost estimates
Basis of estimates
Project schedule
Resource calendars
Risk register
Agreements
Organizational process assets
21
Q

Determine budget tools and techniques

A 
Cost aggregation
Reserve analysis
Expert judgment
Historical relationships
Funding limit reconciliation
22
Q

Determine budget outputs

A

Cost baseline
Project funding requirements
Project documents updates

23
Q

What is the funding limit reconciliation

A

The measurement of variance between the funding limits in the plant expenditures that necessitates the rescheduling of work to level out the rate of expenditures

24
Q

What is the cost baseline

A

The approved version of the time face project budget, excluding any management reserves, which can only be changed or formal change control procedures and is the basis for comparison to actual results

25
Q

What is the control costs process

A

Process of monitoring the status of the project update the project costs and managing changes to the cost baseline

26
Q

Control costs key benefit

A

Provides the means to recognize variance from the plan in order to take corrective action and minimize risk

27
Q

Control costs inputs

A

Project management plan
Project funding requirements
Work performance data
Organizational process assets

28
Q

Control cost tools and techniques

A 
Earned value management
Forecasting
To complete performance index (TCPI)
Performance reviews
Project management software
Reserve analysis
29
Q

Control costs outputs

A 
Work performance information
Cost forecasts
Change request
Project management plan updates
Project documents updates
Organizational process assets updates
30
Q

What are project funding requirements

A

Projected expenditures plus anticipated liabilities

31
Q

What is earned value management (EVM)

A

A methodology to combine scope, schedule, and resource measurements to assess project performance and progress

32
Q

What is planned value

A

The authorized budget assigned to scheduled work

33
Q

What is budget at completion (BAC)

A

The total planned value for the project

34
Q

What is earned value

A

A measure of work performed expressed in terms of the budget authorized for that work

35
Q

What is actual cost

A

The realize cost incurred for the work performed on an activity during a specific time.

36
Q

What is schedule variance

A

A measure of schedule performance expressed as the difference between the earned value and plan value

37
Q

What is cost variance

A

The amount of budget deficit or surplus at a given point in time, express is a difference between earned value and actual cost

38
Q

What is the schedule performance index

A

A measure of schedule efficiency express is the ratio of earned value to plan the value. Under one is bad greater than one is good

39
Q

What is cost performance index

A

A measure of the cost efficiency of budgeted resources, expressed as a ratio of earned value to actual cost. Less than one is bad, greater than one is good

40
Q

What is the manual EAC method

A

It builds upon the actual cost and experiencing card for the work completed.

41
Q

What is the EAC forecast for ET see work performed at the budgeted rate

A

Actual costs plus the difference between budget at completion minus earned value

42
Q

What is the EAC forecast for ETC work performed at the present CPI

A

This method assumes what the product is experience today can be expected into the future. It equals the budget completion divided by the cost performance

43
Q

What is the EAC forecast for ETC work considering both SPI and CPI factors

A

This method is the most useful when the project schedule is a factor impacting the E TC effort. It is equal to the actual cost plus the difference between BAC and EV divided by CPI times SPI

44
Q

What is the to complete performance index (TCPI)

A

A measure of the cost performance that is required to be achieved with the remaining resources in order to meet a specified management goal, express is the ratio of the cost to finish the outstanding work to the remaining budget

45
Q

Define project cost management

A

The processes involved in planning, Estimating, budgeting, financing, funding, managing, and controlling costs so that the project can be completed within the approved budget

PMP Exam (12 decks)

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