 # Completion Formulas

Video Activity

This lesson focuses on project completion formulas and offers examples of how the following formulas work: Estimate at Completion (EAC) Estimate to Complete (ETC) Variance at Completion (VAC) To Complete Performance Index (TCPI) toggle_content title="Transcript" The next couple of formula s is estimate to completion, estimate to compete, variance ...

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Time
5 hours 14 minutes
Difficulty
Intermediate
CEU/CPE
10
Video Description

This lesson focuses on project completion formulas and offers examples of how the following formulas work:

• Estimate at Completion (EAC)
• Estimate to Complete (ETC)
• Variance at Completion (VAC)
• To Complete Performance Index (TCPI)

[toggle_content title="Transcript"] The next couple of formula s is estimate to completion, estimate to compete, variance at completion and to complete performance index (TCPI). Estimate to completion, I am going to take my budgetary completion. At day hundred, I say that was a hundred thousand dollars and I am going to divide that by my CPI. If you remember from the previous slide, my CPI is .7. Budget at completion divided by CPI. I did that on my phone so the number is \$142857.14. Using the CPI if I can continue at the right then I was on day four. This project is going to cost me a lot of money. It is going to cost me \$142857.14.The next thing to figure out is the estimate to complete. The estimate to completion is picking your estimate at completion and subtracting your actual cost. I am going to take \$142857.14 and I am going to subtract the actual cost. Where am I today? 5000. To complete this project I need to have \$137857.14 . For estimate to complete, I am taking the estimate at completion and subtracting the actual cost. We are on day four, I am taking the number I just got from estimate at completion \$142857.14 and am putting it here. I am subtracting day four so my actual cost is \$5000. When I subtract \$5000 from this number I come up with \$137857.14. That's how much money I need in order to complete the project. Next formula is variance at completion. I am going to take my estimate at completion (EAC), and I am going to subtract my budget at completion. So at day 100 it's supposed to be \$100,000. \$142857.14 minus \$100,000, this gives me \$42857.14.This number is big because it is trying to figure out how much over budget I am going to be so \$42857.14 is what I am going to be over budget. Using that formula we are going to take the budget at completion minus the end buyer and budget at completion minus the actual cost. We are going to divide this too. In this scenario the budget at completion is supposed to be \$100,000. I am subtracting the earn value for day four so subtract \$3500 which gives me \$96500. The budget at completion minus the actual cost is \$100,000 minus \$5,000. Which gives me \$95000. When I divide this too I get 1.02. what is this telling me. This is telling me how efficient I need to be to finish my project and beyond budget. For every dollar that is planned, I need to be as efficient as...am getting a dollar and two cents for every dollar that I spend. That is the only way to get my project back on schedule from day four up to day 100 to finish at \$100,000. To close the cost knowledge area, you need to have an understanding of the formulas. You also have to know the processes and the inputs and the outputs and tools. With that information, you should be very well on the test. [/toggle_content]

Video Transcription
00:04
so the next couple formulas is estimate. Completion s meant to complete,
00:09
uh,
00:11
a very insight completion and
00:13
to complete performance
00:16
to complete performance. Index, T c p I
00:19
So s minute completion. I'm going Thio, take my
00:24
budget That completion day 100
00:26
I said that was \$100,000
00:28
and I'm going to divide that by my c p I.
00:32
So if you remember from the previous stop,
00:35
my c p. I
00:37
is
00:38
0.7. So it's
00:40
budget that completion
00:42
divided by
00:44
C. P. I
00:47
and
00:48
I did that on my phone. So the number is
00:53
1401 142,000
00:59
800
01:00
and \$57
01:03
and
01:03
14 cents.
01:06
So using the c p I If I continue at the rate that I was on day four,
01:10
this project's gonna cost me a lot of money. It's gonna cost me \$142,000
01:15
in 857 \$857.14.
01:19
The next thing to figure out is the estimate to complete.
01:22
Um,
01:23
so the estimated completion
01:26
is ah,
01:27
taking your
01:30
estimate at completion
01:32
and dividing in subtracting your actual cost.
01:36
So I am going to take
01:38
this. Ah! \$142,000.
01:42
\$140,000. 857
01:46
0.14
01:48
and I'm gonna attract the actual cost. So
01:52
where I met today,
01:53
5000.
01:57
So this comes out too.
02:00
13
02:04
seven
02:05
a
02:06
five,
02:07
7 14
02:09
So they complete this project,
02:14
I need to have \$137,857.14.
02:20
So for estimate to complete, I am taking the estimate completion
02:23
and subtracting the actual cost. So we're on day four.
02:28
I am taking the number I just got from estimate completion \$142,857.14
02:36
and I'm plugging it in here.
02:38
I'm subtracting day for some actual costs is \$5000.
02:42
So when I subtract \$5000 from this number, I come up with \$137,000. 857
02:49
\$137,857.14.
02:53
That's how much money I need to I need in order to complete the project.
03:00
So the next formula is very exact completion.
03:02
I am going to take my,
03:05
um estimate that completion.
03:07
So e a. C
03:10
and I'm going to subtract my budget. That completion. So at a 100 it's supposed to be \$100,000. So
03:20
142,000
03:23
\$857
03:25
14 cents minus
03:29
\$100,000
03:31
Excuse me,
03:34
42,000
03:36
\$857
03:38
in 14 cents.
03:39
This number is big because it's trying to figure out how much over budget I'm going to be and 42,857
03:49
dollars and 14 cents is what I want to be over budget.
03:52
So this last formula, we're gonna take the budget at completion minus the air in value
03:58
and the budget that completion
04:00
minus the actual costs, we're gonna divide those two.
04:02
So in this scenario, the budget at completion is supposed to be \$100,000.
04:08
I'm subtracting the urn value for day for said \$3500
04:12
which gives me
04:14
\$96,500.
04:17
The budget, at completion minus actual cost, is 100,000 minus \$5000
04:23
which gives me \$95,000.
04:27
When I divide those two, I get 1.2
04:30
So What is this telling me this is telling me how efficient I need to be the finish my budget to finish my project and beyond budget.
04:38
So for every dollar that is planned,
04:41
I need to be as efficient as if I'm
04:44
getting a dollar and two cents for every dollar that I spend.
04:47
That's the only way to get my project back on schedule from day for to get me to a day 100
04:54
finish \$100,000.
04:56
So to close the cost knowledge area,
04:59
yet toe have an understanding of the formulas. You also have to know the processes and the inputs and outputs on tour.
05:05
With that information,
05:08
you should do very well on the test.
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