Formula terminology Flashcards
(31 cards)
CV
Cost Variance
What is the definition of CV?
Provides cost performance of the
project. Helps determine the amount
of budget deficit or surplus at a given
point in time
What is CV Formula
CV = EV – AC
CPI
Cost Performance Index
What is the definition of CPI
The measure of cost efficiency on a
project. The ratio of earned value to
actual cost.
What is CPI Formula
CPI = EV / AC
CPI Result Interpretation
<1 = over budget = over planned cost.
The project is getting <$1 for every $1
spent.
1 = on budget = on planned cost.
The project is getting $1 for every $1
spent.
>1 = under budget = under planned
cost. The project is getting >$1 for
every $1 spent.
What is CV Result Interpretation?
Negative = over budget = over planned
cost
Zero = on budget = on planned cost
Positive = under budget = under
planned cost
SV
Schedule Variance
What is the definition of SV?
Provides schedule performance
of the project. Helps determine if
the project work is proceeding as
planned.
What is the SV formula?
SV = EV – PV
What is SV Interpretation?
Negative = behind schedule
Zero = on schedule
Positive = ahead of schedule
SPI
Schedule Performance Index
What is the definition of Schedule Performance Index
The measure of schedule efficiency
on a project. The ratio of earned value
to planned value. Used to determine
if a project is behind, on or ahead of
schedule. Can be used to help predict
when a project will be completed
What is the SPI formula
SPI = EV / PV
What is SPI Interpretation?
<1 = behind schedule. The project
is progressing at a slower rate than
originally planned.
1 = on schedule. The project is
progressing at the originally planned
rate.
>1 = ahead of schedule. The project
is progressing at a faster rate than
originally planned.
EAC
Estimate at Completion
What is the definition of EAC?
Expected final and total cost of a
project based on project performance.
Helps determine an estimate of the
total costs of a project based on actual
costs to date. There are several ways
to calculate EAC depending on the
current project situation and how the
actual work is progressing as compared
to the budget. Look for keywords in
the exam questions to determine what
assumptions were made
Assumption: use this formula if the
current cost performance is expected
to remain the same for the remainder
of the project.
EAC = BAC / CPI
Assumption: use this formula if the
original estimate was fundamentally
flawed or conditions have changed
and invalidated original estimating
assumptions
EAC = AC + Bottom-up ETC
Assumption: use this formula if the
current cost variance is not expected
to occur again for the remainder of
the project, which means the original
budget is still reliable.
EAC = AC + (BAC – EV)
Assumption: use this formula if
both the CPI and SPI influence the
remaining project work.
EAC = AC + [(BAC – EV) / (CPI * SPI)]
Use this formula if no keywords could
be found.
ETC = EAC – AC
What is the definition of ETC?
The expected cost needed to complete
all the remaining project work. Helps
predict what the final cost of the
project will be upon completion.
There are many ways to calculate
ETC depending on the assumptions
made. Look for keywords in the
exam questions to determine what
assumptions were made.
