Your division manager has requested an update of your project at the end of peri

Question

Your division manager has requested an update of your project at the end of period 8. She specifically would like to know the CV, SV, CPI and SPI. Below is data on the project to date. You know that the total budget for the project is $14,000. Calculate and interpret all four requested values using the cumulative totals for the end of period 8.

Status Report: Ending Period 8 Task %Complete Finished Finished Finished 75% 50% 25% EV 2000 1500 1500 1875 1500 250 8625 AC 2300 1400 1550 2050 1600 400 9300 PV 2000 1500 1500 1600 1200 4 Cumulative Totals 7800

Explanation / Answer

CV

Cost Variance = Earned Value – Actual Cost

CV = EV – AC = 8625 - 9300 = - $675

Cost Variance is negative, this implies that project is over budget.

SV

Schedule Variance = Earned Value – Planned Value

SV = EV – PV = 8625 - 7800 = $825

Schedule Variance is positive, this implies that project is ahead of schedule.

CPI

Cost Performance Index = (Earned Value) / (Actual Cost)

CPI = EV / AC = 8625/9300 = 0.93

CPI is less than one, hence the project is earning less than the amount spent. In other words, it's over budget.

SPI

Schedule Performance Index = (Earned Value) / (Planned Value)

SPI = EV / PV = 8625/7800 = 1.1

SPI is greater than one, hence more work has been completed than the planned work. In other words, project is ahead of schedule.

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