Appropriate EAC Formula

Submitted by Vishwanath on Sun, 07/07/2013 - 14:25

After the last Project   last project meeting your sponsor has asked you to give her anew estimate of the cost at the end of the project. This is because during the meetingit was found that so much has gone wrong until now, that the numbers are probablyoff. It is expected, that from now on things will progress normally. You gather allthe necessary numbers from your PMIS. Which formula will you use to create theexpected total cost of the project?

A.) EAC = BAC/CPI
B.) EAC = AC+ETC
C.) EAC = AC+BAC-EV
D.) ETC = EAC-AC
 
 
 
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pmpnewster

Sun, 07/07/2013 - 17:28

 

B

 

Regards.

 

pmpnewster

Mon, 07/08/2013 - 01:59

 

I can now see why choice C makes sense.

Reason: We use a new bottoms-up estimate when the original estimate was flawed. In the present case, the question does not any anything like that.

All we know is that things have gone wrong till now but that they would proceed normally henceforth. So we should use EAC = AC + (BAC-EV).

Moral of the story: Unless the question explicitly points to the original estimate being flawed (or lost, or never performed) we should not go for a new bottoms-up ETC estimate.

 

Regards.

 

Vishwanath

Sun, 07/07/2013 - 18:17

 C is the correct answer

tweinborg

Sun, 07/07/2013 - 18:54

I interpret this as initial estimates being flawed so I would think B would be the correct formula.  

Tina W. 

th9063

Sun, 07/07/2013 - 21:48

 B......new estimate

th

pmpnewster

Mon, 07/08/2013 - 01:58

 

I can now see why choice C makes sense.

Reason: We use a new bottoms-up estimate when the original estimate was flawed. In the present case, the question does not any anything like that.

All we know is that things have gone wrong till now but that they would proceed normally henceforth. So we should use EAC = AC + (BAC-EV).

Moral of the story: Unless the question explicitly points to the original estimate being flawed (or lost, or never performed) we should not go for a new bottoms-up ETC estimate.

 

Regards.