ompute the followings: a. A project has a budget of $15M and scheduled for 1 year. It is assumed that the total budget will be spent equally each month. After 1 month the project manager finds that only 7.5% of the work is finished and a total of $1.5M spent. Find the following: Variances: CV, SV; Indices: CPI, SPI; Forecasting: EAC, ETC, Time to completion. b. In month 9, the following project information is available: Actual cost is $2000, Earned value is $2100 and Planned cost is $2400. Compute the SV and CV for the project. c. On day 51 a project has an earned value of $600, an actual cost of $650, and a planned cost of $560. Compute the SV, CV and CPI for the project. What is your assessment of project on day 51?
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Compute the followings:
a. A project has a budget of $15M and scheduled for 1 year. It is assumed that the total budget will be spent
equally each month. After 1 month the project manager finds that only 7.5% of the work is finished and a
total of $1.5M spent. Find the following: Variances: CV, SV; Indices: CPI, SPI;
Time to completion.
b. In month 9, the following project information is available: Actual cost is $2000, Earned value is $2100 and
Planned cost is $2400. Compute the SV and CV for the project.
c. On day 51 a project has an earned value of $600, an actual cost of $650, and a planned cost of $560.
Compute the SV, CV and CPI for the project. What is your assessment of project on day 51?
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