Cost Data
Cost Data Overview
• Factors
• Earned Value
• 50/50 Rule
• Examples
Factors
• BCWS - Budgeted Cost Work Scheduled Budget entry numbers
• ACWP - Actual Cost Work Performed Actuals, what you spent
• BCWP - Budgeted Cost Work Performed Earned Value, what you have accomplished
Factors
• BAC - Budget at Completion - the total of all
the budget numbers, the bottom line
• EAC - Estimate at Completion - based on your
rate of expenditures, what you probably will
spend by the end of the project
• CV - Cost Variance, BCWP - ACWP = CV
• SV - Schedule Variance, BCWP - BCWS = SV
Factors
• CPI - Cost Performance Index
BCWP/ACWP = CPI
• SPI - Schedule Performance Index
BCWP/BCWS = SPI
BCWP - Earned Value
• Calculating Earned Value should be easy if
you set up your budget correctly.
• Earned Value or BCWP is the value of what
you have produced. If you have produced
$500,000 worth of the $1,000,000 project,
your BCWP is $500,000 or 50%.
BCWP - Earned Value
• Let’s use a wall as an example:
–
–
–
–
–
–
There are $50 per foot in materials
It will take 4 labor hours per foot to build at $20/hour
There will be $200 in other labor charges
There is a crew of four working
The wall is 80 feet long
On the first and last days the crew has 8 hours of set up
and tear down time each
BCWP - Earned Value
• Budget
– Materials - $50 X 80 = $4000
– Labor for wall - 4 X 80 X $20 = $6400
– Labor for set up and tear down - 16 X $20 =
$320
– Additional Labor - $200
– Total = $10,920
Budget for Wall
Day 1
Set up – 8 hours
$160.
Day 2
Day 3
Day 4
Day 5
Work on wall 32
hours
Work on wall 24 $640
hours
Additional Labor
$480
Spread amongst
Additional Labor the 11 days
Spread amongst $18.18
the 11 days
$18.18
Materials 32/4 =
8
Materials 24/4 =
6
8 X $50 = $400
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Materials 32/4 =
8
Materials 32/4 =
8
Materials 32/4 =
8
8 X $50 = $400
8 X $50 = $400
8 X $50 = $400
6 X $50 = $300
Total for Day =
Total for Day =
Total for Day =
Total for Day =
Total for day =
$958.18
Feet Done = 6
$1058.18
$1058.18
$1058.18
$1058.18
Feet Done = 14
Cum Cost =
$2016.36
Feet Done = 22
Cum Cost =
$3074.54
Feet Done = 30
Cum Cost =
$4132.72
Feet Done = 38
Cum Cost =
$5190.90
Budget for Wall
Day 6
Day 7
Day 8
Day 9
Day 10
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Work on wall 32
hours
$640
Additional Labor
Spread amongst
the 11 days
$18.18
Materials 32/4 =
8
Materials 32/4 =
8
Materials 32/4 =
8
Materials 32/4 =
8
Materials 32/4 =
8
8 X $50 = $400
8 X $50 = $400
8 X $50 = $400
8 X $50 = $400
8 X $50 = $400
Total for Day =
Total for Day =
Total for Day =
Total for Day =
Total for Day =
$1058.18
$1058.18
$1058.18
$1058.18
$1058.18
Feet Done = 46
Cum Cost =
$6249.08
Feet Done = 54
Cum Cost =
$7307.26
Feet Done = 62
Cum Cost =
$8365.44
Feet Done = 70
Cum Cost =
$9423.62
Feet Done = 78
Cum Cost =
$10481.80
Budget for Wall
Day 11
Tear Down - 8 Hours X $20
= $160
Work on wall 8 hours
$160
Additional Labor Spread
amongst the 11 days
$18.18
Materials 8/4 = 2
2 X $50 = $100
Total for Day =
$438.18
Feet Done = 80
Cum Cost = $10919.98
Wall
• Question
– How would you do this budget different?
Actual Construction
Actuals For Wall
•
•
Day 1
Set up – 6 hours
•
10 feet done
•
Materials - 10 X $50 = $500
•
Labor = $18.18 +(32 X $20) = $668.18
•
•
•
Total = $1168.18
BCWS = $958.18
ACWP = $1168.18
BCWP = ?
BCWP
• How would you allocate the budget so you
could determine BCWP?
BCWP
• Easiest is to take total costs and prorate over
some easy thing to measure, like the length
of the wall.
• $10,920/80 = $136.50 / foot completed
Actuals For Wall
•
•
Day 1
Set up – 6 hours
•
10 feet done or a value of (10 X $136.50) = $1365.00 or $1365.00/10,920
complete = 12.5% complete
•
Materials - 10 X $50 = $500
•
Labor = $18.18 +(32 X $20) = $668.18
•
•
•
•
Total = $1168.18
BCWS = $958.18
ACWP = $1168.18
BCWP = $1365.00
Actuals for Wall - Day 1
•
•
•
•
•
•
•
•
BCWS = $958.18
ACWP = $1168.18
BCWP = $1365.00
CV = BCWP - ACWP = 1365.00 - 1168.18 = $196.82 Positive so it is
favorable
SV = BCWP - BCWS = 1365.00 - 958.18 = $406.82 Positive so it is favorable
CPI = BCWP/ACWP = 1365/1168.18 = 1.168 or for every dollar that is spent,
we earn $1.17 in value
SPI = BCWP/BCWS = 1365/958.18 = 1.42 or we are doing about 40% better
on schedule than anticipated.
EAC = BAC/CPI = $10,920/1.17 = $9333.33
Actuals For Wall
•
•
Day 2
It rained - no work performed
•
Labor = $18.18 +(32 X $20) = $668.18
•
•
•
•
Total = $668.18
BCWS = $2016.36
ACWP = $1836.36
BCWP = $1365.00
Actuals for Wall - Day 2
•
•
•
•
•
•
•
•
BCWS = $2016.36
ACWP = $1836.36
BCWP = $1365.00
CV = BCWP - ACWP = 1365.00 - 1836.36 = - $471.36 Negative so it is
unfavorable
SV = BCWP - BCWS = 1365.00 - 2016.36 = - $651.35 Negative so it is
unfavorable
CPI = BCWP/ACWP = 1365/1836.36 = 0.74 or for every dollar that is spent,
we earn $0.74 in value
SPI = BCWP/BCWS= 1365/2016.36 = 0.67 or we are doing much worse than
we budgeted
EAC = BAC/CPI = $10,920/0.74 = $14756.76
Actuals For Wall
•
Day 3
•
Sunny day, crew motivated, did 14 feet today.
•
•
•
Materials = 14 X $50 = $700
Total Done = 24
BCWP = 24 X 136.50 = $3276.00
•
Labor = $18.18 +(32 X $20) = $668.18
•
•
•
•
Total = $1368.18
BCWS = $3074.54
ACWP = $ 3204.54
BCWP = $3276.00
Actuals for Wall - Day 3
•
•
•
•
•
•
•
•
BCWS = $3074.54
ACWP = $ 3204.54
BCWP = $3276.00
CV = BCWP - ACWP = 3276.00 - 3204.54 = $71.46 Positive so it is
favorable
SV = BCWP - BCWS = 3276.00 - 3074.54 = $201.46 Positive so it is
favorable
CPI = BCWP/ACWP = 3276/3204.54 = 1.02 or for every dollar that is spent,
we earn $1.02 in value
SPI = BCWP/BCWS= 3276/3074.54 = 1.06 or we are doing much worse than
we budgeted
EAC = BAC/CPI = $10,920/1.02 = $10,705.89
S - Curves
• Ok, so now we can calculate the statistics
• Next we want to be able to graph the
numbers and see where we are from a visual
perspective.
S Curves
• S Curves are a good way to see at a glance
what is going on.
• The following curve shows our data on a
graph.
S Curves
BCWS
ACWP
BCWP
S Curves
BCWS
BCWP
ACWP
S Curves
BCWS
BCWP
ACWP
S Curves
BCWS
ACWP
BCWP
S Curves
BCWS
ACWP
BCWP
S Curves
BCWS
ACWP
BCWP
S Curves
BCWS
ACWP
BCWP
S Curves
BCWS
ACWP
BCWP
Wall Example Continued
• The following Excel example shows how
the curves can be used.
50/50 Rule
• Frame has an easier way to calculate earned
value.
• It is called the 50/50 rule.
• With this rule, you earned 50% of the
earned value the instant you start a task and
the other 50% when the task is complete.
50/50 Rule
Task 1 = $50k
Task 2 = $25k
Task 3 = $40k
50/50 Rule
Task 1 = $50k: Started so, we have
earned $25k
Task 2 = $25k
Task 3 = $40k
BCWP = ?
50/50 Rule
Task 1 = $50k: Started so, we have
earned $25k
Task 2 = $25k
Task 3 = $40k
BCWP = 25K
50/50 Rule
Task 1 = $50k: Started so, we have
earned $25k
Task 2 = $25k: Started so
have earned $12.5k
Task 3 = $40k
BCWP = ?
50/50 Rule
Task 1 = $50k: Started so, we have
earned $25k
Task 2 = $25k: Started so
have earned $12.5k
Task 3 = $40k
BCWP = $37.5K
50/50 Rule
Task 1 = $50k: Finished so, we have
earned $50k
Task 2 = $25k: Started so
have earned $12.5k
BCWP = $82.5K
Task 3 = $40k:
Started so we
have earned
$20k
Reminders
• BCWP can never exceed BCWS
• At the end of a project the schedule
variance will always equal zero
• Cost variance can exceed BCWS