# MGMT 562-Assume that you have completed three months of the project

Subject: Mathematics    / Statistics
Question

In the Microsoft Excel, add a new worksheet called “Earned Value.” with the exception of the following:

Instead of PV=\$100,000, use the Week 16 Cumulative Cost from your Project Cash Flow Report generated above.

Assume that you have completed three months of the project. The BAC was \$200,000 for this six-month project. You can also make the following assumptions:

PV ¼ \$120,000

EV ¼ \$100,000

AC ¼ \$90,000

a. What is the cost variance, schedule variance, cost performance index (CPI), and schedule performance index (SPI) for the project?

b. How is the project doing? Is it ahead of schedule or behind schedule? Is it under budget or over budget?

c. Use the CPI to calculate the estimate at completion (EAC) for this project. Is the project performing better or worse than planned?

d. Use the SPI to estimate how long it will take to finish this project.

e. Sketch an earned value chart using the preceding information. See Figure 7-5 as a guide.

Term Formula

Earned value (EV) EV ¼ PV to date * RP

Cost variance (CV) CV ¼ EV _ AC

Schedule variance (SV) SV ¼ EV _ PV

Cost performance index (CPI) CPI ¼ EV/AC

Schedule performance index (SPI) SPI ¼ EV/PV

Estimate at completion (EAC) EAC ¼ BAC/CPI

Estimated time to complete Original time estimate/SPI