Schedule Variance SV= 200,000-600,000 SV= -400,000 Cost Variance CV= 40,000-200,000 CV= -160,000 2. Jimmy’s point about the material cost does have merit. The cost of the material is the biggest cost incurred for this project. The cost of the material changes the numbers to calculate the earned value because the question is about the work being done not the materials. 3. Jimmy and Eric both have valid points about the status of the project. Jimmy’s point of the project being on track does make sense since they are starting the third phase at five weeks which takes 3 weeks and the final phase will take one week equaling four weeks left. Eric’s point of the project not on budget is also correct since the schedule and cost variances are negative numbers. 4. The advice I would have for Eric related to his new role of VP of Operations would be to educate the project manager on the cost and schedule variances. Instead of barking at Jimmy, Eric could have approached the discrepancies differently. To be a productive and efficient VP of operations, understanding others may not have the same education and help them gain that knowledge.