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Formulas / Math for PMP

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If you think a formula is missing here but required in PMP exam. Post a comment and we will add to this table.

1. PERT

(P + 4M + O )/ 6 Pessimistic, Most Likely, Optimistic

2. Standard Deviation

(P - O) / 6

3. Variance

[(P - O)/6 ]squared

4. Float or Slack

LS-ES and LF-EF

5. Cost Variance

EV - AC

6. Schedule Variance

EV - PV

7. Cost Perf. Index

EV / AC

8. Sched. Perf. Index

EV / PV

9. Est. At Completion (EAC)

BAC / CPI,

AC + ETC -- Initial Estimates are flawed

AC + BAC - EV -- Future variance are Atypical

AC + (BAC - EV) / CPI -- Future Variance would be typical

10. Est. To Complete

Percentage complete

EAC - AC

EV/ BAC

11. Var. At Completion

BAC - EAC

12. To Complete Performance Index TCPI

Values for the TCPI index of less then 1.0 is good because it indicates the efficiency to complete is less than planned. How efficient must the project team be to complete the remaining work with the remaining money?

( BAC - EV ) / ( BAC - AC )

13. Net Present Value

Bigger is better (NPV)

14. Present Value PV

FV / (1 + r)^n

15. Internal Rate of Return

Bigger is better (IRR)

16. Benefit Cost Ratio

Bigger is better ((BCR or Benefit / Cost) revenue or payback VS. cost)

Or PV or Revenue / PV of Cost

17. Payback Period

Less is better

Net Investment / Avg. Annual cash flow.

18. BCWS

PV

19. BCWP

EV

20. ACWP

AC

21. Order of Magnitude Estimate

-25% - +75% (-50 to +100% PMBOK)

22. Budget Estimate

-10% - +25%

23. Definitive Estimate

-5% - +10%

24. Comm. Channels

N(N -1)/2

25. Expected Monetary Value

Probability * Impact

26. Point of Total Assumption (PTA)

((Ceiling Price - Target Price)/buyer's Share Ratio) + Target Cost

Sigma σ
  • 1σ = 68.27%
  • 2σ = 95.45%
  • 3σ = 99.73%
  • 6σ = 99.99985%
Return on Sales ( ROS )
 

Net Income Before Taxes (NEBT) / Total Sales OR

Net Income After Taxes ( NEAT ) / Total Sales

Return on Assets( ROA )
 

NEBT / Total Assets OR

NEAT / Total Assets

Return on Investment ( ROI )

NEBT / Total Investment OR

NEAT / Total Investment

Working Capital

Current Assets - Current Liabilities

Discounted Cash Flow

Cash Flow X Discount Factor

Contract related formulas

Savings = Target Cost – Actual Cost

Bonus = Savings x Percentage

Contract Cost = Bonus + Fees

Total Cost = Actual Cost + Contract Cost

Critical Path formulas 

Forward Pass: (Add 1 day to Early Start)                EF = (ES + Duration - 1)
Backward Pass: (Minus 1 day to Late Finish)
LS = (LF - Duration + 1)
ES = Early Start; EF = Early Finish;
LS = Late Start; LF = Late Finish

 

EVA = Net Operating Profit After Tax - Cost of Capital (Revenue - Op. Exp - Taxes) - (Investment Capital X % Cost of Capital) EVA - Economic Value Add Benefit Measurement - Bigger is better

 

Source Selection = (Weightage X Price) + (Weightage X Quality)

#14 Present Value formula is incorrect.

Submitted by slangley on Mon, 03/31/2008 - 02:04.

As written the formula only works for 1 year.

 The proper formula should be:

 PV=  FV / ((1 + r)^term)  

admin's picture

Correction made. Thanks a

Submitted by admin on Mon, 03/31/2008 - 03:37.

Correction made. Thanks a lot for reporting the error

 

 

 I thinks the right formula

Submitted by Watson1 on Fri, 10/21/2011 - 06:21.

 I thinks the right formula is 

PV=  FV / ((1 + r)^term)  

seguridad-en-internet-ya.blogspot.com

Sigma

Submitted by ram6s9 on Fri, 06/06/2008 - 21:28.

For the sake of completeness, I guess it would be better to include the Six Sigma value too.

 6 Sigma = 99.99985

Burn Rate formulae

Submitted by manishsinghal on Mon, 08/18/2008 - 07:27.

The formulae for Burn Rate is

1/CPI where CPI = Cost performance Index.

PERT Formula Error

Submitted by barbarapmp on Tue, 09/16/2008 - 19:35.

 The formula you have listed for PERT is incorret.  The actual formula is:

(P+(4xM)+O)/6

OR to make it less confusing for folks:

(Pessimistic Estimate + (4 x Most Likely Estimate) + Optimistic Estimate) / 6

(P + 4M + O ) / 6  is

Submitted by o3dr0p0ut1o on Thu, 02/17/2011 - 14:48.

(P + 4M + O ) / 6

 

is correct if your follow the MDAS rule...

Franchise

Submitted by MichelSteve on Fri, 10/21/2011 - 11:38.

 I just checked the MDAS rule and after this i got know that it is true.Any how tahnks for recommending.

Franchises

PMBOK 4 Formula's

Submitted by miansahib on Tue, 09/15/2009 - 22:08.

Hi Gurus,

May I know some one maintaining these formula's and updating for PMBOK4.

also I want to know How many Formula's are in Total in PMBOK4 and can someone please share if already  got it.

 Regards,

Can you pl. be more

Submitted by ChandraR on Wed, 01/13/2010 - 13:59.

Can you pl. be more specific how this question is related to PMP?

 

Thanks

Chandra 

 

How I remember EV formula

Submitted by Have2passfirsttry on Fri, 07/08/2011 - 00:59.

I learned this in a class I took.I thought I would share.

AC          operand               EV           operand               PV

<---------------                    -------------->

CV=                        _                                             _                                             SV

CPI=                       /                                              /                                              SPI

 

Arranged alphabetically AC, EV, PV, and the sides  Cs before Ss

Begin with EV and move to the right or left to find your sides

CV= EV-AC

SV=EV-PV

CPI=EV/AC

SPI=EV/PV

Then u just have to remember/memorize :

EAC=BAC/CPI

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