Schedule and Cost Variance Problem

Assume you have collected the following data for your project Assume you have collected the following data for your project. Its budget is $75,000 and it is expected to last 4 months. After two months, you have calculated the following information about the project: PV = $45,000 EV = $38,500 AC = $37,000 Calculate the SPI and CPI. Based on these values, estimate the time and budget necessary to complete the project? How would you evaluate these findings (i.e., are they good news or bad news?)

Calculate the SPI and CPI. Assume you have collected the following data for your project. Its budget is $75,000 and it is expected to last 4 months. After two months, you have calculated the following information about the project: PV = $45,000 EV = $38,500 AC = $37,000 Calculate the SPI and CPI. Based on these values, estimate the time and budget necessary to complete the project? How would you evaluate these findings (i.e., are they good news or bad news?) Solution: SPI = EV/PV = $38,500/45,000 = .86   CPI = EV/AC = $38,500/37,000 = 1.04 Estimated Time to Completion = (1/.86) x 4 months = 4.65 months Estimated Cost to Completion = (1/1.04) x $75,000 = $72,078 The findings are a bit of good news and a bit of bad. The good news is that your estimated cost to completion is lower than the original budget; however, the bad news is that the project is behind schedule and is likely to take 4.65 months to complete, rather than the originally planned 4 months