ITEC 411 Alaska Bible College Project Cost Management Analysis and Lab Report answer the following questions on the world documentation feel free to ask when it is not clear.thank you ITEC 411: Assignment 6 – Cost Management
Cost Management (ITPM chapter 7). Answer the questions below thoroughly and completely (one
sentence answers will not be sufficient). Submit 1 Word document (.doc), 1 Excel worksheet (Project
Cost Estimate) via BlackBoard assignments. Be sure to include your name, course.section and
1. What are the processes (discussed in class) involved in project cost / budget management.
2. Why is it important for a PM to understand financial terms? Define the following financial terms:
profit, profit margin, life cycle costing and cash flow analysis.
3. What are costs? What are benefits? What tangible cost and benefits? What are in intangible cost
and benefits? What direct and indirect cost?
4. What is earned value (EV)? Explain how earned value management can be used to control costs and
measure project performance.
5. Given the following information for a 1 year (12 months) project:
PV = $23,000
EV = $20,000
AC = $25,000
BAC = $120,000
Answer the following questions:
a. What is the cost variance (CV), schedule variance (SV), cost performance index (CPI) and
schedule performance index (SPI) for the project
b. How is the project doing? Is it ahead of schedule, on schedule or behind schedule? Is it under
budget, on budget or over budget?
c. Use the CPI to calculate the estimate at completion (EAC) for this project. Is the project
performing better than planned, as planned as or worse than planned?
d. Use the SPI to estimate how long it will take to complete the project.
XXX Project Cost Estimate
Note: Use your WBS items and other entries to meet your project needs.
Use formulas to calculate totals and subtotals properly.
# Units/Hrs. Cost/Unit/Hr. Subtotals
WBS Level 1 Totals % of Total
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