AACE International CCP Exam Actual Questions

Cost Variance (CV) is an EVM metric that indicates whether the project is under or over budget by comparing the earned value to the actual cost.

Key Points:

CV Formula:

CV = BCWP - ACWP

BCWP = 105,000 work hours

ACWP = 110,000 work hours

Calculation:

CV = 105,000 - 110,000 = -5,000 work hours

Interpretation:

A negative CV indicates that the project is over budget, as more work hours were paid for than were earned.

Conclusion: The correct answer is A. BCWP-ACWP = 105,000-110,000 = -5,000 because this calculation accurately reflects the cost variance of the project.

Schedule Variance (SV) is another EVM metric that measures the difference between the work performed and the work scheduled.

Key Points:

SV Formula:

SV = BCWP - BCWS

BCWP = 105,000 work hours

BCWS = 100,000 work hours

Calculation:

SV = 105,000 - 100,000 = 5,000 work hours

Interpretation:

A positive SV indicates that the project is ahead of schedule, as more work has been performed than was planned.

Conclusion: The correct answer is D. BCWP - BCWS = 105,000 - 100,000 = 5,000 because this calculation accurately reflects the schedule variance of the project.

Estimate at Completion (EAC) is a forecasting tool in EVM that predicts the total cost of the project at completion based on current performance.

Key Points:

EAC Formula:

One common method to calculate EAC is:

EAC = ACWP + (BAC - BCWP)

Where:

ACWP is the Actual Cost of Work Performed,

BAC is the Budget at Completion,

BCWP is the Budgeted Cost of Work Performed.

This formula assumes that the remaining work will be performed at the budgeted rate (i.e., future work will follow the planned performance), and it adjusts the total estimate by adding the cost of the remaining work to the actual costs incurred so far.

Conclusion: The correct answer is D. ACWP + (BAC - BCWP) because this method provides a reliable estimate for the total project cost at completion, considering current performance.

To determine the correct percent complete, the earned value approach is used. The percent complete is calculated as follows:

Percent Complete = (Earned Work Hours / Budgeted Work Hours) 100

Given:

Earned Work Hours (EV) = 105,000 hours

Budgeted Work Hours (BAC) = 200,000 hours

Percent Complete = (105,000 / 200,000) 100 = 52.5%

However, this option is not available in the choices. The closest correct answer, considering standard rounding, is 55.0%. The rounding here accounts for small inaccuracies, which is typical in project management estimations, but in strict terms, the correct value is closer to 52.5%, and a better answer than 55.0% could have been provided as per detailed cost estimating principles.

Schedule Performance Index (SPI): This measures schedule efficiency and is calculated as:

SPI = Earned Work Hours / Scheduled Work Hours

SPI = 105,000 / 100,000 = 1.05 (indicating the project is ahead of schedule)

Cost Performance Index (CPI): This measures cost efficiency and is calculated as:

CPI = Earned Work Hours / Actual Work Hours Paid

CPI = 105,000 / 110,000 = 0.955 (indicating cost overrun)

Even though the project is slightly ahead of schedule, the cost performance is poor, resulting in a bad cost status despite a seemingly good schedule status. Thus, the overall interpretation should be cautious, but with cost considered primary, the correct conclusion is that the schedule is good, but cost is bad.