Managing Projects - Week 4 / Project Cost Management

Question 1

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

Answer 1

Time, budget

Question 2

Cost management involves four key processes?

Answer 2

• PLAN cost management
• ESTIMATE costs
• DETERMINE budget
• CONTROL costs

Question 3

Used as the framework for all cost management activities?

Answer 3

WBS (Work Breakdown Structure)

Question 4

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

Answer 4

Plan Cost Management

Question 5

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

Answer 5

Schedule of Quantities

Question 6

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

Answer 6

Historical Data

Question 7

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

Answer 7

Estimate Cost

Question 8

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

Answer 8

Determine Budget

Question 9

Costs allocated to activities can be grouped into?

Answer 9

Cost Centres

Question 10

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

Answer 10

S-Curve

Question 11

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

Answer 11

Control Costs

Question 12

Control Cost includes:?

Answer 12

• Monitoring
• Ensuring
• Preventing
• Informing

Question 13

Increases with time and project resolution?

Answer 13

Estimating Accuracy

Question 14

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

Answer 14

Historical Data

Question 15

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

Answer 15

Detailed Pricing Activities

Question 16

Estimates may also be prepared using?

Answer 16

Parametric Modeling

Question 17

Types of costs?

Answer 17

• Direct (Project Activity)
• Indirect (Administrative)

Question 18

Types of costs can be:?

Answer 18

• Finance
• Labour
• Materials
• Production equipment
• Planning Procurement
• Transportation
• Marketing
• Contingencies

Question 19

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

Answer 19

Schedule (or bill) of Quantities

Question 20

How cost variances will be managed?

Answer 20

Cost Management Plan

Question 21

Set of procedures and principles for effective cost management?

Answer 21

Cost Management Plan

Question 22

Estimating can involve a combination of?

Answer 22

• Historical evidence
• Current market information

Question 23

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

Answer 23

Contingencies

Question 24

Decisions about contingencies is called?

Answer 24

Reserve Analysis

Question 25

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)?

Answer 25

Cost Planning

Question 26

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

Answer 26

Working Capital

Question 27

More time =?

Answer 27

Higher project expenses

Question 28

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

Answer 28

Cash Fluctuations

Question 29

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

Answer 29

Project Retention

Question 30

For late completion?

Answer 30

Liquidated damages

Question 31

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

Answer 31

Restoration Costs

Question 32

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

Answer 32

Working Capital

Question 33

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

Answer 33

Earned Value (EV)

Question 34

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

Answer 34

Project Budget

Question 35

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

Answer 35

Realistic, achievable

Question 36

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

Answer 36

Inflation

Question 37

Who determines project priority?

Answer 37

Project Sponsor

Question 38

When does the project priority usually change?

Answer 38

Near the end of the project

Question 39

Gap between general inflation and specific escalation is known as?

Answer 39

Differential Escalation

Question 40

Documents used to request payment?

Answer 40

Invoices

Question 41

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

Answer 41

Invoice Control Sheet

Question 42

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

Answer 42

Goods and Services Tax (GST)

Question 43

Cost estimating and budget preparation can be done using?

Answer 43

Life Cycle Cost

Question 44

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

Answer 44

Equivalent Values

Question 45

Drawbacks to spending less money?

Answer 45

- 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

Question 46

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

Answer 46

Costs

Question 47

Process you will use to capture cost estimates:?

Answer 47

- 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

Question 48

Budgeting

Answer 48

- Form of communication - WBS guides - Design budget and group together

Question 49

Budgeting Processes

Answer 49

- Bottom-up estimates - Work packages - Present management

Question 50

Cash Flow Chart

Answer 50

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