Which process involves aggregating the estimated costs of the individual schedule activities or work packages?

Question

Options

• ACost baseline
• BCost forecasting
• CCost variance
• DCost budgeting

• A
  8% (2)
• B
  4% (1)
• C
  12% (3)
• D
  77% (20)

Explanation

Cost Budgeting (D) is correct because it is the process of aggregating the estimated costs of individual schedule activities or work packages to establish an authorized cost baseline - this is the definition straight from the PMBOK Guide.

• A (Cost Baseline) is wrong because it's the output of cost budgeting, not the process itself - it's the time-phased budget used to measure and monitor cost performance.
• B (Cost Forecasting) is wrong because forecasting projects future costs based on current performance data (like EAC - Estimate at Completion), not aggregating original estimates.
• C (Cost Variance) is wrong because it's a performance measurement (CV = EV − AC) that tells you how much over or under budget you are, not a process for building the budget.

Memory tip: Think of the word "budget" literally - when you make a household budget, you add up (aggregate) all your individual expenses. Cost Budgeting does exactly that: it rolls up the individual estimates into one total. The word "aggregating" in the question is your direct signal to pick Budgeting.

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