PK0-003 · Question #337
The project manager wants to report to the stakeholders to date project's cost performance. If the total of completed work to date is $200,000 and the actual cost is $210,000, which of the following i
The correct answer is C. -$10,000. This question asks to calculate the cost variance for a project, given the earned value of completed work and the actual cost incurred to date.
Question
The project manager wants to report to the stakeholders to date project's cost performance. If the total of completed work to date is $200,000 and the actual cost is $210,000, which of the following is the cost variance?
Options
- A-5%
- B5%
- C-$10,000
- D$10,000
How the community answered
(49 responses)- A12% (6)
- B4% (2)
- C76% (37)
- D8% (4)
Why each option
This question asks to calculate the cost variance for a project, given the earned value of completed work and the actual cost incurred to date.
This represents a percentage variance, which is typically part of the Cost Performance Index (CPI) calculation (EV/AC) or a percentage deviation, not the absolute cost variance.
This also represents a positive percentage variance, which is incorrect for the given figures and is not the direct cost variance value.
Cost Variance (CV) is calculated as Earned Value (EV) minus Actual Cost (AC). In this scenario, EV is $200,000 and AC is $210,000. Therefore, the CV is $200,000 - $210,000 = -$10,000, indicating the project is over budget.
This is the absolute value of the difference between EV and AC, but cost variance specifically indicates whether the project is under or over budget, requiring a negative sign for an over-budget situation.
Concept tested: Calculating project cost variance (CV)
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