Formulas for PMP

Updated: 19th Sept.

If you think a formula is missing here but required in PMP exam. Post a comment and we will add to this table.

1. PERT	(P + 4M + O )/ 6 Pessimistic, Most Likely, Optimistic
2. Standard Deviation	(P - O) / 6
3. Variance	[(P - O)/6 ]squared
4. Float or Slack	LS-ES and LF-EF
5. Cost Variance	EV - AC
6. Schedule Variance	EV - PV
7. Cost Perf. Index	EV / AC
8. Sched. Perf. Index	EV / PV
9. Est. At Completion (EAC)	BAC / CPI, AC + ETC -- Initial Estimates are flawed AC + BAC - EV -- Future variance are Atypical AC + (BAC - EV) / CPI -- Future Variance would be typical
10. Est. To Complete Percentage complete	EAC - AC EV/ BAC
11. Var. At Completion	BAC - EAC
12. To Complete Performance Index TCPI	Values for the TCPI index of less then 1.0 is good because it indicates the efficiency to complete is less than planned. How efficient must the project team be to complete the remaining work with the remaining money? ( BAC - EV ) / ( BAC - AC )
13. Net Present Value	Bigger is better (NPV)
14. Present Value PV	FV / (1 + r)^n
15. Internal Rate of Return	Bigger is better (IRR)
16. Benefit Cost Ratio	Bigger is better ((BCR or Benefit / Cost) revenue or payback VS. cost) Or PV or Revenue / PV of Cost
17. Payback Period	Less is better Net Investment / Avg. Annual cash flow.
18. BCWS	PV
19. BCWP	EV
20. ACWP	AC
21. Order of Magnitude Estimate	-25% - +75% (-50 to +100% PMBOK)
22. Budget Estimate	-10% - +25%
23. Definitive Estimate	-5% - +10%
24. Comm. Channels	N(N -1)/2
25. Expected Monetary Value	Probability * Impact
26. Point of Total Assumption (PTA)	((Ceiling Price - Target Price)/buyer's Share Ratio) + Target Cost
Sigma σ	1σ = 68.27% 2σ = 95.45% 3σ = 99.73% 6σ = 99.99985%
Return on Sales ( ROS )	Net Income Before Taxes (NEBT) / Total Sales OR Net Income After Taxes ( NEAT ) / Total Sales
Return on Assets( ROA )	NEBT / Total Assets OR NEAT / Total Assets
Return on Investment ( ROI )	NEBT / Total Investment OR NEAT / Total Investment
Working Capital	Current Assets - Current Liabilities
Discounted Cash Flow	Cash Flow X Discount Factor
Contract related formulas	Savings = Target Cost – Actual Cost Bonus = Savings x Percentage Contract Cost = Bonus + Fees Total Cost = Actual Cost + Contract Cost