Earned Value Management Question for ETC ,VAC, CPI,CV , PV and EAC


Earned Value Management is a  great way to track performance of your Project's schedule and cost.
Here is a sample Question:
Activity A is worth $200, is 100% complete, and actually cost $200. Activity B is worth $75, is 90% complete, and actually cost $120 so far. Activity C is worth $200, is 75% complete and has cost $175 so far. The total budget is $1000.

What is 1) ETC 2) VAC 3) CPI 4) CV 5) PV 6) EAC

Answers:
You need to look at the activites as tied to an entire project.
The BAC is $1,000.

PV(Planned Value)
1.Activity A's PV -$200
2.Activity B 's PV -$75
3.Activity C's PV -$200

Then start calculating the EV

EV(Earned Value)
1.Activity A is BAC*Actual % Complete
200*100% =200
2.Activity B is BAC*Actual % Complete
75*90%=67.5
3.Activity C is BAC*Actual % Complete
200*75% =150
Total Earned Value = 417.5

AC(Actual Cost) **there is no formular to this
Activity A+ Activity B + Activity C
Total Actual Cost =200+120+175 = 495

CPI
(Cost Performance Index)
CPI= EV/AC
417.5/495 = 0.8434

CV(Cost Variance)
EV-AC
417.5 -495 = (-77.5)

EAC=Estimate at Completion
BAC/CPI
1000/0.8434= 1185.68


VAC=Variance at Completion
BAC-EAC=
1000-1185.68=  (-185.68)


ETC=Estimate to complete
EAC-AC=
1185.68 - 495 = (-81.715)
The project will not be completing on planned budget.
CPI less than 1 shows you are over budget

Comments

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  6. A smallish campaign with a homemade list would not be likely to yield much of a result. To achieve anything worthwhile, a much more aggressive effort is needed. Then, the age-old value analysis applies: projected earnings = margin on total projected sales - cost of campaign.

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