For formula based qts"atypical and typical"
Is there a hint to find out when to use atypical vs typical formula?
Can some one get me there as I am not able to come to conclusion when to use atypical / typical.
Thankyou in advance.
Tue, 10/14/2014 - 19:20
a. Project cost has no deviations from the budget or the rate of spending is the same Since the
amount being spent on the project is in line with established budget, the BAC is used to
compute the EAC.
EAC = BAC ÷ CPI
b. Original estimates are flawed If original estimates of the cost of the project are flawed, it is
best to make a new estimate of the cost of the remaining work in order to compute the EAC.
This new ETC includes a manual analysis of all the remaining work in the project bearing in
mind past performance.
EAC = AC + ETC
c. Project has atypical variances Atypical variances imply that the project had an unexpected risk
or opportunity that skewed the project performance results. If the risk or opportunity is not
likely to be repeated, the variance is considered to be atypical. In this case EAC is
EAC = AC + (BAC − EV)
d. Project has typical variances Typical variances imply that the variances that have occurred in
the project are likely to be repeated in the future. In this case EAC is
EAC = AC + [(BAC − EV) ÷ CPI]
Variance at Completion
Variance at Completion (VAC) is an indicator of whether the project is over or under the Budget at
Completion. It is the difference between the Budget at Completion and the Estimate at Completion.
VAC = BAC − EAC
If VAC > 0 the project is under budget.
If VAC < 0 the project is over budget.
If VAC = 0 the project is on budget.
Tue, 10/14/2014 - 19:26
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