Fred is the project manager of the NHA project. This project has a BAC of $2,456,900 and is sixty percent complete. Fred has crashed the project, which has driven the project costs to date to $1,525,140, but his project is five percent more complete than what was planned.
What is the cost variance for this project that Fred needs to report to management?
- $122,845
- -$51,000
- -$85,000
- Zero
Answer(s): B
Explanation:
The cost variance for the project is -$51,000. You can find the cost variance by using the formula earned value minus planned value. In this instance, it is: CV = EV - AC = (0.60* 2,456,900) - 1,525,140 = -51,000
Answer option C is incorrect. -$85,000 is the project's variance at completion.
Answer option A is incorrect. $122,845 is the project's schedule variance.
Answer option D is incorrect. There is a cost variance on this project of -$51,000.
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