Cost Control and Budgeting Flashcards

What is the To-Complete Performance Index (TCPI) based on BAC if BAC = $1,000,000, EV = $400,000, and AC = $500,000?

Answer: 1.20

TCPI = (BAC − EV) / (BAC − AC) = $600,000 / $500,000 = 1.20, the efficiency needed to finish on budget.

Which statement best describes a control account in an EVMS structure?

Answer: The intersection of a WBS element and an organizational unit where cost, schedule, and scope are managed

A control account is the management control point formed at the intersection of the WBS and the OBS.

A CAM is asked to begin work that the customer has verbally approved but has not yet been definitized. What should the CAM require first?

Answer: Formal work authorization before charging to the account

No work should begin or be charged without formal, documented work authorization.

Actual costs in a control account should be recorded in a manner consistent with which other element?

Answer: The way the corresponding budget was planned and earned value is claimed

Budget, earned value, and actual cost must be recorded consistently so variances are meaningful.

Which condition typically triggers an Over-Target Baseline (OTB)?

Answer: The remaining budget is insufficient to realistically plan the remaining work

An OTB reprograms the baseline when remaining budgets are no longer adequate for realistic planning of remaining work.

A level-of-effort (LOE) work package will always show what schedule variance characteristic?

Answer: SV of zero because EV automatically equals PV

LOE earns value with the passage of time so EV always equals PV, forcing SV to zero.

Why should LOE be minimized within a control account that is mostly discrete work?

Answer: LOE can mask true schedule performance of the discrete effort

Because LOE never shows schedule variance, mixing it with discrete work dilutes and masks real performance signals.