Given the following information for a one year project, answer the following questions. Recall that PV is planned value, EV is the earned value, AC is the actual cost, and BAC is the budget at completion.
PV= $23,000 EV= $20,000 AC= $25,000 BAC= $120,000
a. What is the cost variance, schedule variance, cost performance index, and the schedule performance index for the project?
Cost Variance
CV = EV - AC
CV= $20,000 - $25,000 = -$5,000
Schedule Variance
SV = EV-PV
SV= $20,000 - $23,000 = -$3,000.0
Cost Performance Index
CPI = EV / AC
CPI= $20,000 / $25,000 = 80%
Schedule Performance Index
SPI = EV / PV
SPI= $20,000 - $23,000 = 87%
b. How is the project doing? Is it ahead of schedule or behind schedule? Is it under budget or over budget?
Based on above values, the Schedule Variance has a negative value which means that the project has taken longer than planned to perform the work. However, the CPI index which is 111% means the project is over budget. The project is also behind schedule based on the Schedule Performance Index which is 83%
c. Use the CPI to calculate the estimate at completion for this project. Is the project performing better or worst than planned?
As we know the budget at completion (BAC) is $120,000 and the cost performance index (CPI) is 80%.
Therefore EAC = BAC/CPI
EAC = ($120,000 / 80%) * 100 = $150,000
Therefore the project is over $30,000 which means the project is worse than planned.
d. Use the schedule performance index to estimate how long it will take to finish this project?
The time allocated for this project is 12 months and schedule performance index is 87 %. Therefore Estimated time to completed = Original Time Estimate/SPI
Estimated time to complete = 12 months / 87% = 13.80
The time to complete this project will take 13.80 months or 13 months and 26/27 days depending on the calender month.
e. Sketch the earned value chart based for this project, using figure 7-5 as a guide.
PV= $23,000 EV= $20,000 AC= $25,000 BAC= $120,000
a. What is the cost variance, schedule variance, cost performance index, and the schedule performance index for the project?
Cost Variance
CV = EV - AC
CV= $20,000 - $25,000 = -$5,000
Schedule Variance
SV = EV-PV
SV= $20,000 - $23,000 = -$3,000.0
Cost Performance Index
CPI = EV / AC
CPI= $20,000 / $25,000 = 80%
Schedule Performance Index
SPI = EV / PV
SPI= $20,000 - $23,000 = 87%
b. How is the project doing? Is it ahead of schedule or behind schedule? Is it under budget or over budget?
Based on above values, the Schedule Variance has a negative value which means that the project has taken longer than planned to perform the work. However, the CPI index which is 111% means the project is over budget. The project is also behind schedule based on the Schedule Performance Index which is 83%
c. Use the CPI to calculate the estimate at completion for this project. Is the project performing better or worst than planned?
As we know the budget at completion (BAC) is $120,000 and the cost performance index (CPI) is 80%.
Therefore EAC = BAC/CPI
EAC = ($120,000 / 80%) * 100 = $150,000
Therefore the project is over $30,000 which means the project is worse than planned.
d. Use the schedule performance index to estimate how long it will take to finish this project?
The time allocated for this project is 12 months and schedule performance index is 87 %. Therefore Estimated time to completed = Original Time Estimate/SPI
Estimated time to complete = 12 months / 87% = 13.80
The time to complete this project will take 13.80 months or 13 months and 26/27 days depending on the calender month.
e. Sketch the earned value chart based for this project, using figure 7-5 as a guide.
