ExpertHard1 markShort Answer
PMP · Question 007 · Task 5: Plan and manage budget and resources
A project has a Budget at Completion (BAC) of $100,000. The project is currently 40% complete. The Actual Cost (AC) is $45,000 and the Earned Value (EV) is $40,000. The project manager expects the current cost variance to be typical for the remainder of the project. What is the Estimate at Completion (EAC)? (Enter the number only, no currency symbols).
A project has a Budget at Completion (BAC) of $100,000. The project is currently 40% complete. The Actual Cost (AC) is $45,000 and the Earned Value (EV) is $40,000. The project manager expects the current cost variance to be typical for the remainder of the project. What is the Estimate at Completion (EAC)? (Enter the number only, no currency symbols).
How to approach this question
Calculate CPI first, then use the formula EAC = BAC / CPI.
Full Answer
1. Calculate CPI: EV ($40,000) / AC ($45,000) = 0.8888...<br/>2. Calculate EAC: BAC ($100,000) / CPI (0.8888...) = $112,500.<br/>Alternatively: $100,000 * ($45,000 / $40,000) = $112,500.
Common mistakes
Using the wrong EAC formula (e.g., AC + BAC - EV) which applies when variance is atypical.
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