Formulas Flashcards
(64 cards)
Cost Variance (CV) Formula
Concept
Results Interpretation
FORMULA: CV = EV – AC
Concept:
Provides cost performance of the
project. Helps determine the amount
of budget deficit or surplus at a given
point in time
Results:
Negative = over budget = over planned
cost
Zero = on budget = on planned cost
Positive = under budget = under
planned cost
Cost Performance Index (CPI)
Concept
Results Interpretation
FORMULA: CPI = EV / AC
Concept:
The measure of cost efficiency on a
project. The ratio of earned value to
actual cost.
Results
<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.
Schedule Variance (SV)
Concept
Results Interpretation
FORMULA: SV = EV – PV
CONCEPT: Provides schedule performance
of the project. Helps determine if
the project work is proceeding as
planned
RESULTS
Negative = behind schedule
Zero = on schedule
Positive = ahead of schedule
Schedule Performance Index (SPI)
Concept
Results Interpretation
FORMULA: SPI = EV / PV
CONCEPT:
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.
RESULTS
<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.
Schedule Variance (SV), an
alternative method
Concept
Results Interpretation
FORMULA: SV = ES – AT
CONCEPT: Provides schedule performance of the
project in terms of Earned Schedule
(ES) and Actual Time (AT).
RESULTS:
Negative = behind schedule.
The project earned less than planned
Zero = on schedule. The project earned
as planned.
Positive = ahead of schedule. The
project earned more than planned.
Schedule Performance Index (SPI)
(Alternative Method)
Concept
Results Interpretation
FORMULA: SPI = ES / AT
CONCEPT: Measure of schedule efficiency on a project in terms of Earned Schedule
(ES) and Actual Time (AT).
RESULTS: <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.
Estimate at Completion (EAC)
CONCEPT:
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.
FORMULA
EAC = BAC / CPI
RESULTS
Original budget modified by the cost
performance. The result is a monetary
value.
Assumption: use this formula if the
original estimate was fundamentally
flawed or conditions have changed
and invalidated original estimating
assumptions.
FORMULA
EAC = AC + Bottom-up ETC
RESULTS
Actual cost plus a new bottom-up
estimate for the remaining work. The
result is a monetary value.
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.
FORMULA
EAC = AC + (BAC – EV)
RESULTS:
Actual cost to date (AC) plus unearned
budget (BAC – EV). The result is a
monetary value
Assumption: use this formula if
both the CPI and SPI influence the
remaining project work.
FORMULA
EAC = AC + [(BAC – EV) / (CPI * SPI)]
RESULTS:
Actual cost to date (AC) plus unearned
budget (BAC – EV) modified by both
cost performance and schedule
performance. The result is a monetary
value.
Estimate to Complete (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.
Assumption: Use this formula if no keywords could
be found.
FORMULA: ETC = EAC – AC
RESULTS:
Expected total cost minus actual cost
to date. The result is a monetary value
that tells how much more the project
will cost
Assumption: A new estimate is developed when it is thought that the original estimate was flawed.
RESULTS:
This is neither a formula nor the result
of a calculation. It is simply a new
bottom-up cost estimate (re-estimate)
of the remaining project work.
Assumption: use this formula if
current variances are not expected
to occur again for the remainder of
the project, which means the original
budget is still reliable.
Formula: ETC = BAC – EV
Results:
The value of the unearned project
work. The result is a monetary value.
Assumption: use this formula if
both the CPI and SPI influence the
remaining project work.
Formula: ETC = (BAC – EV) / (CPI * SPI)
Results:
The value of the unearned project work
modified by both cost performance
and schedule performance. The result
is a monetary value.
Assumption: use this formula if
current cost performance is expected
to remain the same for the remainder
of the project.
Formula: ETC = (BAC / CPI) – AC
Results:
Original budget modified by the cost
performance minus the actual cost.
The result is a monetary value.
To-Complete Performance Index (TCPI)
Assumption:
A measure of cost performance that
must be achieved on the remaining
work to meet a specific management
goal (e.g., BAC or EAC).
It is the work remaining divided by the
funds remaining.
Formula:
Based on BAC:
TCPI = (BAC – EV) / (BAC – AC)
Based on EAC:
TCPI = (BAC – EV) / (EAC – AC)
Results:
>1 = harder to complete. The project
needs to improve its cost performance
to be completed on target.
1 = same to complete. Same cost
efficiency can be maintained to
complete the project.
<1 = easier to complete. The project is
expected to achieve its cost targets.
Variance at Completion (VAC)
Assumption:
Anticipates the difference between the
originally estimated BAC and a newly
calculated EAC. In other words, the cost
that was originally planned minus the
cost that is now expected.
Formula:
VAC = BAC – EAC
Result Interpretation:
The result is a monetary value that
estimates how much over or under
budget (the variance) the project will
have by its completion.
<0 = over planned budget
=0 = on planned budget
>0 = under planned budget
Earned Value (EV)
Assumptions:
A measure of completed work
expressed in terms of the budget
authorized for that work.
Formula:
EV = Sum of PV of completed work
Assumption: use this formula if PV for
all completed work is given.
EV = % complete * BAC
Assumption: use this formula if PV for
all completed work is not given.
Results:
The result is the EV, a monetary value.
Activity Duration
Assumptions:
Determines how long an activity lasts.
There are two formulas; both will give
the same result
Formula’s:
Duration = EF – ES + 1
Duration = LF – LS + 1
Results:
Number of days an activity lasts.
Free Float
Assumptions:
The amount of time a schedule activity
can be delayed without delaying
the early start date of any successor
activity or violating a schedule
constraint.
Formula’s:
Free Float = ES of Successor Activity
– EF of Present Activity –
Results:
A number of time units (typically
days) an activity can be delayed
without delaying the early start of the
successor activity.
Note: If the present activity has more
than one successor activity, then use
the earliest ES of any of the successor
activities
Total Float
Assumptions:
The amount of time a schedule activity
can be delayed or extended from
its early start date without delaying
the project finish date or violating a
schedule constraint. There are two
formulas, both will give the same
result.
Formula:
Total Float = LS – ES
Total Float = LF – EF
Results:
A number of time units (typically days)
an activity can be delayed without
delaying the finish date of the project.
Early Finish (EF)1
Assumptions:
Determine when an activity can finish
at the earliest.
Formula:
EF = (ES + duration) – 1
Results:
A number of time units (typically days)
an activity can be delayed without
delaying the finish date of the project.
