Formulas / Math for PMP
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 |
|
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 |
Critical Path formulas
Forward Pass: (Add 1 day to Early Start) EF = (ES + Duration - 1)
Backward Pass: (Minus 1 day to Late Finish)
LS = (LF - Duration + 1)
ES = Early Start; EF = Early Finish;
LS = Late Start; LF = Late Finish
EVA = Net Operating Profit After Tax - Cost of Capital (Revenue - Op. Exp - Taxes) - (Investment Capital X % Cost of Capital) EVA - Economic Value Add Benefit Measurement - Bigger is better
Source Selection = (Weightage X Price) + (Weightage X Quality)
Comments
slangley (not verified)
Mon, 03/31/2008 - 02:04
Permalink
#14 Present Value formula is incorrect.
As written the formula only works for 1 year.
The proper formula should be:
PV= FV / ((1 + r)^term)
admin
Mon, 03/31/2008 - 03:37
Permalink
Correction made. Thanks a
Correction made. Thanks a lot for reporting the error
ram6s9 (not verified)
Fri, 06/06/2008 - 21:28
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Sigma
For the sake of completeness, I guess it would be better to include the Six Sigma value too.
6 Sigma = 99.99985
manishsinghal (not verified)
Mon, 08/18/2008 - 07:27
Permalink
Burn Rate formulae
The formulae for Burn Rate is
1/CPI where CPI = Cost performance Index.
barbarapmp (not verified)
Tue, 09/16/2008 - 19:35
Permalink
PERT Formula Error
The formula you have listed for PERT is incorret. The actual formula is:
(P+(4xM)+O)/6
OR to make it less confusing for folks:
(Pessimistic Estimate + (4 x Most Likely Estimate) + Optimistic Estimate) / 6
o3dr0p0ut1o
Thu, 02/17/2011 - 14:48
Permalink
(P + 4M + O ) / 6 is
(P + 4M + O ) / 6
is correct if your follow the MDAS rule...
MichelSteve
Fri, 10/21/2011 - 11:38
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Franchise
I just checked the MDAS rule and after this i got know that it is true.Any how tahnks for recommending.
Franchises
miansahib
Tue, 09/15/2009 - 22:08
Permalink
PMBOK 4 Formula's
Hi Gurus,
May I know some one maintaining these formula's and updating for PMBOK4.
also I want to know How many Formula's are in Total in PMBOK4 and can someone please share if already got it.
Regards,
ChandraR
Wed, 01/13/2010 - 13:59
Permalink
Can you pl. be more
Can you pl. be more specific how this question is related to PMP?
Thanks
Chandra
Have2passfirsttry
Fri, 07/08/2011 - 00:59
Permalink
How I remember EV formula
I learned this in a class I took.I thought I would share.
AC operand EV operand PV
<--------------- -------------->
CV= _ _ SV
CPI= / / SPI
Arranged alphabetically AC, EV, PV, and the sides Cs before Ss
Begin with EV and move to the right or left to find your sides
CV= EV-AC
SV=EV-PV
CPI=EV/AC
SPI=EV/PV
Then u just have to remember/memorize :
EAC=BAC/CPI
twenty20
Mon, 03/26/2012 - 08:44
Permalink
Helpful
This is really helpful ! Thanks for compiling !!
Cheers, Naveen
sspawar
Thu, 08/23/2012 - 15:20
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ROM RANGE
PMBOK 4 IS +/- 50%,
AND IN ABOVE LIST IT IS -50/+100 %, I THINK IT WAS IN PMBOK 3.
ranajee
Tue, 03/12/2013 - 14:01
Permalink
This is a great summary and
This is a great summary and thanks for putting it together.
Is there any excel sheet or printable version of these formulae.
NagwaHelal
Wed, 05/29/2013 - 15:39
Permalink
PERT relate question
Would u please advise. How to solve this question (in details please)
You have received estimates for one of your project tasks as follows: The Pessimistic estimate is 32 days, the Optimistic estimate is 26 days, and the Most Likely estimate is 22 days. Using this information, calculate the range of Finish Dates for this task with a certainty of 99.999 percent (6 STD).
Choose one answer.
24 days to 26 days
18 days to 30 days
24 days to 28 days
22 days to 26 days
atmic
Mon, 06/24/2013 - 22:59
Permalink
Answer: 18 days to 30 days
Solution.
Step 1. Determine expected value for estimation: (O+4M+P)/6 = (26+88+32)/6 = 24.33
Step 2. Find Standard Deviation (SD): (P-O)/6 = (32-26)/6 = 1
Step 3. Determine Standard distribution against the required probability.
Since the requirement of probability is 99.999... % (which is 6 Sigma = 99.99985...), then its standard deviation equal:
SD x 6Sigma = 1 x 6 = 6,
which helps to calculate the range from the expected value:
24.33 -/+6 = from 18 days to 30 days (approximately for this case).
qusroo
Fri, 05/31/2013 - 01:06
Permalink
Learn
Hi,
The above sheet is help full,,,,
but can u suggest what is the best way to remember the formulas.
atmic
Wed, 06/26/2013 - 15:02
Permalink
Using, mentoring and sharing ideas with others
I think, the best way for understanding and memorizing the formulas, other rules and principals is using them on your projects; alternatively, mentoring and sharing your thoughts with others.
I also found a very useful community that helps you to understand sophisticated questions and allows sharing your ideas.
https://plus.google.com/110378594959350757709/posts
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ahmed855
Mon, 05/12/2014 - 06:47
Permalink
Formulas not from PMBOK!
Hello,
I am wondering, where did you find these formulas? They don't exist at all in the PMBOK 5th edition!
I am referring to:
13. Net Present Value
14. Present Value PV
15. Internal Rate of Return
16. Benefit Cost Ratio
17. Payback Period
25. Expected Monetary Value
26. Point of Total Assumption (PTA)
Sigma σ
Return on Sales ( ROS )
Return on Assets( ROA )
Return on Investment ( ROI )
Working Capital
Discounted Cash Flow
Contract related formulas
How do they come in the exam if never been mentioned in PMBOK !
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