Hi,

I came across this particular question from Cristophoer Scordo (on PMI site).

A project was estimated to cost $ 200,000 with a timeline of 10 months. Due to a shipment delay, the schedule was slightly delayed. This was however made up by receiving the first batch of materials for the project by air. The net result was that there was some additional cost in the project. At the end of the second month, the project manager reviews the project and finds that the project is 20% complete and Actual Costs are $ 50,000. The Estimate to complete (ETC) for the project would now be:

1. 
   

   $160,000



2. 
   

   $210,000



3. 
   

   $250,000



4. 
   

   $200,000

After finding EV, the book says ETC = BAC-EV, While Rita book suggests ETC= EAC-EV. My understanding is, its always a good practice to first find EAC, as BAC remaining same through the project is not always true. And moreover BAC-EV would give the remaining Planned value for the project, while Estimate to Complete (ETC), is how much more will the project cost(as per RITA), and it has to be on actuals and not planned.

My calculation: EV = 40,000 EAC = BAC/CPI, CPI = 40,000/50000 = 0.8 and hence EAC= 250000. As ETC=EAC-EV = 200,000. ANSWER D

Book Answer: EV=40,000. ETC=BAC-EV, 200,000-40,000 = 160,000. ANSWER A.  I feel this wrong, since CPI is less and as question mentions that there was some additional cost. If it were to be 160,000 that means project is on track regarding budget.

Please share your views on this and correct me if i have missed something. Also I have my exam scheduled for 13th Aug (few days left!!), any suggestion or tip for exam would be helpful.

Regards,

Anand KL