PCM Group

CPU BUSINESS AND INFORMATION TECHNOLOGY COLLEGE
SCHOOL OF GRADUATE STUDIES

MASTER OF PROJECT MANAGEMENT (MPM)
Project cost management

Group assignment
1) ABDULWAS MEHAMED -----------EMPM/1263/14--------section 02

2) BEREKET PAULOS------------------ EMPM/1264/14--------section 02
3) BRUK TGSETU------------------------ EMPM/1351/14--------Section 02
4) DAWIT SISAY------------------------- EMPM/1262/14---------section 02
Sub. To DR. MESELE (PhD)

Sub. Date DEC-12-2022
Group Assignment
1) You have been selected to project manage the construction of a sports centre and the project is
3 months into phase 2, which is to complete the final fit (all the interiors) of the ground floor,
fit out all the electrics, plumbing and gasworks for the first and second floors and finalize the
installation of the roof and air conditioning system.
When going through all the progress reports previously given to the Project Sponsor and
stakeholders, and those sent to the previous PM, you realize that this project phase had:
 a planned value of £280,000
 an earned value of £250,000 and
 actual costs amounting to £295,000
What are the implications for your project?
a) This project is on track to deliver and is within its budget
b) This project is behind schedule but is within budget
c) This project is on schedule but over budget
(d) This project is behind schedule and over budget
2) You have been selected to project manage the construction of a sports centre and the project is
3 months into phase 2, which is to complete the final fit (all the interiors) of the ground floor,
fit out all the electrics, plumbing and gasworks for the first and second floors and finalize the
installation of the roof and air conditioning system.
When going through all the progress reports previously given to the Project Sponsor and
stakeholders, and those sent to the previous PM, you realize that this project phase had:
 a planned value of £280,000
 an earned value of £250,000 and
 actual costs amounting to £295,000
And what should you do about this situation?
a) Do nothing as you know the teams can easily catch up in the time left during this phase
b) Have an urgent meeting with the Project Sponsor to share this information and lay the blame
on your predecessor
(c) Examine the PM Plan to find out where the variances happened and why
and to see what can be done to pull things back
1
d) Resign now because there are no contingencies left and the project cannot recover from this
mess
3) PV=$190,000 EV =$150,000 AC = $170,000
What does this mean?
Mean authorized budget assign to this activity is $190,000, The budget authorized for
completed work is $150,000, and realized cost incurred for the work performed on this activity
during a specific time period is $170,000.
What are the SV and CV? Interpret your result
 SV=EV-PV = 150,000 - 190,000
= -40,000
 CV=EV-AC= 150,000 - 170,000
= -20,000
 Both SV and CV values are negative therefore project is over budget and behind the
schedule.
4) PV=$190,000 EV =$150,000 AC = $170,000

A. What is the SPI? Interpret it
Is a measure of the conformance of actual progress (earned value to the planned progress)
EV
SPI 
PV
150,000

190,000
= 0.79
0.79 < 1 there fore the project is over run of the planned
B. What is the CPI? Interpret it
Is a measure of the conformance of the actual work completed (measured by its earned
value to the actual cost incurred)
EV
CPI 
AC
2
150,000

170,000
= 0.88 = 88%
5) PV=$140,000 EV =$160,000 AC = $145,000

what does this mean'?
Mean authorized budget assign to this activity is $140,000, The budget authorized for
completed work is $160,000, and realized cost incurred for the work performed on this activity
during a specific time period is $145,000
What are the SV and CV?
SV = EV-PV
= 160,000 - 140,000
= 20,000
CV = EV-AC
=160,000 - 145,000
= 15,000
6) PV=$140,000 EV= S160,000 AC = $145,000

A. What is the SPI?
EV
SPI 
PV
160,000

140,000
= 1.143
B. What 1s the CPI?
EV
CPI 
AC
3
160,000

145,000
= 1.103
7) PV=$240,000 EV=$250,000 AC = $270,000
Instructions: Interpret each Result
A. Scheduled Variance
SV= EV -PV
=250,000 - 240,000
=10,000
 values is positive therefore project is under the schedule.
B. %of scheduled variance
= 0.042 = 4.2%
Cost variance
CV= EV-AC
=250,000 - 270,000
= -20,000
 Values is negative therefore project is over budget.
C. Scheduled of cost variance

Behind schedule
D. Scheduled performance index(SP)
EV
SPI 
PV
250,000

240,000
=1.042
1.042 >1 there fore the project is under run of the planned
4
E. Cost Performance index (CPI)
EV
CPI 
AC
250,000

270,000
=0.93
8) You are the project manager on a project that has $800,000 software development effort.
There are two teams of programmers that will work for six month for a total of 10.000 hours.
According to the project schedule your team should be done with 38% of the work. As of
today, the project is 40% complete while 50% budget has been used. Calculate and share your
conclusion
A. Scheduled Variance
B. oof scheduled variance
C. Cost variance
D. Scheduled of cost variance
E. Scheduled performance index(SPI)
F. Cost Perfomance index (CPI)
5
9. Your project is scheduled for 2 years. There are six diferent teams working on five major
functional areas. Some teams are ahead of schedule while others are falling behind. There are
cost overruns in some areas but you' ve also saved costs in others. Due to all this, it is difficult
to understand whether you are over or under budget. Nine months into the project, while the
total project budget is $4.200.000. you've already spent $l,650,000.CPI 1s 0.875. Can you
pertorm EV analysis and forecast Instruction: Calculate
A. EAC
B. ETC
C. VAC
6
10. BAC is $40,000 and EAC iS $30.000, EV is $17,000 and AC Is $15,000. What is the BAC
based TCPI
7
8

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CPU BUSINESS AND INFORMATION TECHNOLOGY COLLEGE

SCHOOL OF GRADUATE STUDIES

Project cost management

1) ABDULWAS MEHAMED -----------EMPM/1263/14--------section 02

Sub. To DR. MESELE (PhD)

(d) This project is behind schedule and over budget

What are the SV and CV? Interpret your result

 SV=EV-PV = 150,000 - 190,000

 CV=EV-AC= 150,000 - 170,000

4) PV=$190,000 EV =$150,000 AC = $170,000

5) PV=$140,000 EV =$160,000 AC = $145,000

6) PV=$140,000 EV= S160,000 AC = $145,000

B. %of scheduled variance

C. Scheduled of cost variance

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