ExpertHard1 markShort Answer
PMP · Question 16 · Task 5: Plan and manage budget and resources
A project has a Budget at Completion (BAC) of $100,000. Currently, the Earned Value (EV) is $40,000 and the Actual Cost (AC) is $50,000. The project manager expects the current cost performance to continue 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. Currently, the Earned Value (EV) is $40,000 and the Actual Cost (AC) is $50,000. The project manager expects the current cost performance to continue 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, then use the formula EAC = BAC / CPI.
Full Answer
1. Calculate CPI = EV / AC = 40,000 / 50,000 = 0.8.<br/>2. Formula for 'current variances are typical': EAC = BAC / CPI.<br/>3. EAC = 100,000 / 0.8 = 125,000.
Common mistakes
Using the wrong EAC formula (e.g., AC + BAC - EV) which assumes future work will be at budgeted rate.
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