EVM Certification EVM Certification Cost Control & Budgeting 1

Question 1

What does the Budget at Completion (BAC) represent in Earned Value Management?

Accepted Answer

The total planned cost for the entire project

Answer

BAC is the total approved budget allocated for the entire project scope.

Question 2

Which formula is used to calculate the Estimate at Completion (EAC) when future work is expected to proceed at the planned rate?

Accepted Answer

EAC = AC + (BAC - EV)

Answer

When future performance is expected at the planned rate, EAC = AC + (BAC – EV), meaning remaining work is done at budget.

Question 3

A project has a CPI of 0.85. What does this indicate about the project's cost performance?

Accepted Answer

The project is over budget — getting only $0.85 of value per dollar spent

Answer

A CPI below 1.0 means the project is over budget, delivering less value than the money spent.

Question 4

What is the Variance at Completion (VAC) formula?

Accepted Answer

VAC = BAC - EAC

Answer

VAC = BAC – EAC shows the projected difference between the original budget and the expected final cost.

Question 5

On an EVM project, the Cost Variance (CV) is calculated as:

Accepted Answer

EV minus AC

Answer

CV = EV – AC; a positive CV means the project is under budget, while a negative CV means over budget.

EVM Certification Practice Test