RMC 9th Edition Flashcards - Cost Management Formulas

Question 1

VAC

Answer 1

Variance at completion: as of today, how much over or under budget do we expect to be at the end of the project?

BAC - EAC

Question 2

EAC

Answer 2

Estimate at completion: what do we currently expect the total project to cost (a forecast)?

BAC/CPI

Question 3

PV

EV

AC

Answer 3

Planned value: as of today, what is the estimated value of the work planned to be done?

Earned value: as of today, what is the estimated value of the work actually accomplished?

Actual cost (total costs): as of today what is the actual cost incurred for the work accomplished?

Question 4

BAC

Answer 4

Budget at completion (the cost baseline): how much did we budget for the total project effort?

Question 5

TCPI

Answer 5

To-complete performance index

(BAC - EV)/BAC - AC)

This formula divides the value of the work remaining to be done by the money remaining to do it. It answers the question “to stay within budget, what rate do we need to meet for the remaining work?”

Greater than 1 is bad; less than one is good

Question 6

SPI

Answer 6

Schedule performance index

EV/PV

We are (only) progressing at ___ percent of the rate originally planned. Greater than one is good; less than one is bad.

Question 7

SV

Answer 7

Schedule Variance

EV - PV

Negative is behind schedule; positive is ahead of schedule

Question 8

ETC

Answer 8

Estimate to complete: from this point on, how much more do we expect it to cost to finish the project( a forecast)?

An alternate way to compute: EAC - AC

Question 9

CPI

Answer 9

Cost performance index

EV/AC

We are getting $___ worth of work out of every $1 spend. Funds are or are not being used efficiently. Greater than one is good; less than one is bad.

Question 10

CV

Answer 10

Cost Variance

EV - AC

Negative is over budget, positive is under budget