Problem 1. A project in its 26th week has an actual cost of $270,000. It was sch
ID: 449966 • Letter: P
Question
Problem 1. A project in its 26th week has an actual cost of $270,000. It was scheduled to have spent $261,000. For the work performed to date, the budgeted value is $272,000. What are the cost and schedule variances for the project? What are the SPI and CPI?
Problem 2. A project has just completed its 87th item in the project plan. It was scheduled to have spent $168,000 at this point in the plan, but has actually spent only $156,000. The project manager estimates that the value of the work actually finished is nearly $162,000. What are the spending and schedule variances for the project? What are the SPI and CPI?
Problem 3. The following project is at the end of its 6th week. Find the cost and schedule variances. Also find the CPI and SPI. Then find the critical ratio of the project using earned value calculations. Finally, calculate the ETC and EAC for the project.
Activity
Predecessor
Duration (wks)
Budget ($)
Actual Cost ($)
%Complete
a
-
2
300
400
100
b
-
3
200
180
100
c
a
2
250
300
100
d
a
5
600
400
20
e
b,c
4
400
200
20
Problem 4. Solve the following Case:
Stoneworth Paving Company specializes in highway paving jobs for state of Virginia. When the State first awarded Stoneworth the contract, they stipulated a 1% penalty for each week Stoneworth was late on a completion date. Preston Flintrock, the project coordinator for Stoneworth, began to notice that the last two jobs were three weeks late, and the paving job that was due to be completed in the next two weeks was behind schedule. When Preston went in the field to investigate, he found the job to be understaffed, supplier delays, and a high work rejection/repaving needed. As a result, Preston decided to establish a better system of project control and present it to the boss.
Question 1: If you were Preston, what characteristics would you be looking for in a new control system? Explain
Question 2: Will a new control system be adequate for the problem? Explain
Activity
Predecessor
Duration (wks)
Budget ($)
Actual Cost ($)
%Complete
a
-
2
300
400
100
b
-
3
200
180
100
c
a
2
250
300
100
d
a
5
600
400
20
e
b,c
4
400
200
20
Explanation / Answer
Ans 1
Here
BCWP - Budgeted Cost of Work Performed = $272,000
BCWS - Budgeted Cost of Work Scheduled = $261,000
ACWP - Actual Cost of Work Performed = $270,000
Schedule Variance = BCWP - BCWS = $272,000 - $261,000 = $11,000
Since SV is positive it indicates project is ahead of schedule
SPI = BCWP BCWS = 272,000/261,000 = 1.042
Since SPI is above 1 efficiency of the time utilized on the project is good.
Cost Variance = BCWP - ACWP = $272,000 - $270,000 = $2,000
Since CV is positive it indicates project is under budget
CPI = BCWP ACWP = 272,000/270,000 = 1.0074
Since CPI is above 1 efficiency of the utilizing the resources on the project is good.
I hope this will help. Good luck.
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