Cost variance and schedule variance, Cost Accounting

Assignment Help:

(i) In terms of cashflow, which month will be the most costly for your project?

(ii) If the 3rd and 4th months are more expensive by 25% each because the outsourced labour took longer than expected, what is the effect on the final predicted project cost? What action do you think you could take in these circumstances? 

3(c) Assume you have completed three months of the project. The Budget at Completion (BAC) was $250,000 for this six-month project. Also assume the following:

Planned Value (PV) = $150,000

Earned Value (EV) = $140,000

Actual Cost (AC) = $125,000  

2343_Cost variance and schedule variance.png

Use this information to answer the following questions.

(i) What is the cost variance, schedule variance, cost performance index (CPI), and schedule performance index (SPI) for the project?

(ii) Use the CPI to calculate the estimate at completion (EAC) for this project. Use the SPI to estimate how long it will take to finish this project. Sketch an earned value chart using the above information, including the EAC point. Use the chart below (Figure 7-5, p.289 in Schwalbe 5ed) as an example of what your Earned Value Chart should look like. Comment on your chart.

(iii) How is the project doing? Is it ahead of schedule or behind schedule? Is it under budget or over budget? Should you alert POSS senior management and ask for assistance?


Related Discussions:- Cost variance and schedule variance

Calculate monthly excess returns, In this exercise you will familiarize you...

In this exercise you will familiarize yourself with index models, beta and CAPM estimation. Download the spreadsheet data_question3.xlsx from Sakai and use the data contained there

Link between financial and cost books, Link between Financial and Cost Book...

Link between Financial and Cost Books The link among the two sets of books is achieved via operating a cost ledger control account and a financial ledger control account.  Cos

Determine the annual holding cost, A company produces three types of items....

A company produces three types of items. A single machine is used to produce the three items on a cyclical basis. The company has the policy that every item is produced once during

How many bottles do they need to sell to breakeven, Denair Fine Wines, Inc....

Denair Fine Wines, Inc., is planning to bring out a higher-quality wine product than any currently available in Stanislaus county. They've decided on selling the blended, fortified

Statement of changes in working capital, A statement of changes in working ...

A statement of changes in working capital assists us in locating where such changes took place. In the first example we try to demonstrate the increase or decrease in particular it

calculate the percent interest rate and effective cost, 1. The following t...

1. The following three one-year "discount" loans are available toyou: Loan A: $120,000 at a 7 percent discount rate Loan B: $110,000 at a 6 percent discount rate Loan

Find the statement of cash flows, 1. A fellow student says to you: "The sta...

1. A fellow student says to you: "The statement of cash flows is the easiest of the basic financial statements to prepare because you know the answer before you start. You compa

Calculate the predetermined overhead rate, Bubba's Crawfish Processing Comp...

Bubba's Crawfish Processing Company uses a traditional overhead allocation based on direct labor hours. For the current year, overhead is estimated at $1,150,000, and direct labor

Behavioural aspects of standards, Behavioural Aspects of Standards Bud...

Behavioural Aspects of Standards Budgets and Standards rely heavily on the people who have to work to meet them. Since the detailed nature of standard costing and its involvem

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd