TCPI

Submitted by sai_murthy on Sat, 07/31/2010 - 03:46

 


Question: Calculate the to-complete performance index of your project, based on EAC, when the actual cost of your project is $200,000, cost variance of your project is $25,000 and the budget at completion of your project is $350,000.

1.     1.125

2.     -1.4

3.     1

4.     -1

Source says : 1.125, why I cannot say it as 1 ?


Regards


Sai M

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pkukilla

Sat, 07/31/2010 - 06:44

 EV-AC= CV so   EV=AC+CV=200,000+25,000= 225,000

                                 CPI=EV/AC= 225,000/200,000= 1.125

                                    EAC=BAC/CPI = 311,000

                         TCPI= (Work Remaining/Fund Remaining)

In the question its specifically asked to use EAC for calculating funds remaining

                                 TCPI= (BAC-EV)/(EAC-AC)= 125,000/111,00=1.125

 

 

 

 

jagjitdhaliwal@...

Sat, 07/31/2010 - 15:17

Hi pkukilla,

I think the confusion is related to way EAC is calculated. You can calculate by using formula EAC = AC + (BAC-EV).

EAC = 200,000 + (350,000 - 225,000) = 325,000

TCPI = (BAC-EV)/(EAC-AC)=(350,000 - 225,000)/(325,000 - 200,000) = 125,000/125,000 = 1

Question didn't talk about nature and current state of project, so even I am confused which formula of EAC should be used.

Regards,

Jagjit

 

pkukilla

Sun, 08/01/2010 - 00:20

Normally EAC=BAC/CPI is the formula used unless it is stated in the question if there was atypical variance