You are the project manager of the NHQ project. Your project has a budget of $1,258,456 and is
scheduled to last for three years. Your project is currently forty percent complete though it should
be forty-five percent complete. In order to reach this point of the project, you have spent $525,000.
Management needs a performance report regarding the NHQ project. Management is concerned
that this project will be over budget upon completion. What is the estimate at completion for this
project that you will need to report to management?

A.
-$62,922.80

B.
$1,312,504

C.
$1,525,000

D.
$787,504

Explanation:
The estimate at completion can be calculated by dividing the budget at completion by the cost
performance index. Here, CPI =EV/AC=(0.40*1,258,456)/525000 = 0.95882 EAC = BAC/CPI =
1,258456/0.95882 = 1,312,504 What is Estimate at Completion (EAC)? Estimate at Completion
(EAC) is a field that displays the final cost of the project including the actual costs and the forecast
of remaining costs based on the cost performance index (CPI) so far. The formula used to
calculate this estimate is as follows: ACWP+(BAC-BCWP)/CPI
Answer option D is incorrect. $787,504 is the estimate to complete.
Answer option A is incorrect. -$62,922.80 is the schedule variance.
Answer option C is incorrect. This is not a valid calculation for this question.