PMP - Cost Management

 The flashcards below were created by user cbass on FreezingBlue Flashcards. In earned value how is a cost variance calculated? CV = EV - AC or BCWP - ACWP In earned value how is CPI calculated? EV / AC or BCWP / ACWP What is the EAC and how is it calculated? Estimate at Completion EAC = BAC / CPI assumes current performance will continue EAC = AC + (BAC-EV) assumes remaining work will be done at original budget rate EAC = AC + [(BAC-EV) / (CPI x SPI)]needed if you also have to consider effect of the schedule if you have an imposed firm deadline Name two methods of accelerated depreciation 1. Double Declining Balance2. Sum of the years digits What is working capital Current assets minus current liabilities What is the purpose of a management reserve? to reduce the chance of a cost overrun What is value analysis and how does the process work? A cost reduction tool composed of four major steps1. Analyze a proposed design2. Determine relative cost of each function3. Assess whether each function is really needed4. Assess how to provide the necessary functions at the lowest cost without compromising quality or performance IRR is ? Internal Rate of Return - an estimate of a project's profitability expressed as a percentage - the higher the better What is an approximate range of accuracy for a bottom up estimate? -5 to +10% What is cost control? 1. Influencing factors which create changes2. Ensuring requested changes are agreed upon3. Managing the actual changes as they occur4. Determining that the cost baseline has changed What is the learning curve theory? The learning curve theory holds that costs will decrease as you get better at doing a repetitive task. Unit costs will decrease in a regular pattern each time the number of units produced is doubled Authorcbass ID52080 Card SetPMP - Cost Management DescriptionPMP Cost Management Review Updated2010-11-29T01:25:49Z Show Answers