cost management -- cost variance
Submitted by vijayavadrevu on Sat, 03/23/2013 - 14:08
Julie has just completed a periodic analysis of her project. Her estimate to complete(ETC) the project is an additional $280,000. This brings the estimated total cost (EAC) of the project to $600,000. If Julie calculates Earned Value (EV) to be $350,000, what is the cost variance (CV) on this project?
Ans is given as $30,000
CV= EV-AC
ETC=EAC-AC
Getting confused in calculating AC
If BAC = EAC*CPI i.e., BAC = EAC *EV/AC is to be considered, then is BAC = 600,000-280,000 = 320,000?
Iam not knwing as to how AC is to be arrived at?
can someone guide please?
Forums:
bkthakkar
Sat, 03/23/2013 - 14:24
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The case above is mentioned
The case above is mentioned is of atypical phenomenon
in such case
EAC = AC + BAC -EV
EAc = 600000
ETC = 280000 which is eqvivalent = BAC - EV
BAC = 280000+EV(350000) = 6300000
Cost Variance = EAC - BAC =600000-6300000 = -30000
I hope i am correct
Bhavesh
vijayavadrevu
Sat, 03/23/2013 - 15:58
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How is it atypical? Can you
How is it atypical? Can you please elaborate?
Regards
Vijaya
sspawar
Sat, 03/23/2013 - 15:48
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This brings the estimated
This brings the estimated total cost (EAC) of the project to $600,000.
Her estimate to complete(ETC) the project is an additional $280,000.
EAC = AC +ETC
600000 =AC + 280000
AC = 320000
CV = EV-AC
If Julie calculates Earned Value (EV) to be $350,000,
CV = 350000-320000 = 30000
vijayavadrevu
Sat, 03/23/2013 - 16:07
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Thank You SIr
Thank You SIr
akekokung
Mon, 03/25/2013 - 04:34
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Answer:
Cost variance = +30,000