You work as a Project Manager for Media Perfect Inc. Several projects are running under your
supervision. Rick, team leader of a project, provides you performance indexes of his project. The
schedule variance (SV) of his project is 25. What does this figure depict?

A.
Project is behind the schedule.

B.
Costs are higher than planned.

C.
Project is right on target.

D.
Project is ahead of the schedule.

Explanation:
According to the question, the schedule variance (SV) of the project is 25, which is a positive
value. The positive SV depicts that the project is ahead of the planned schedule. What is SV?
Schedule variance (SV) is a measure of schedule performance on a project. The variance notifies
that the schedule is ahead or behind what was planned for this period in time. The schedule
variance is calculated based on the following formula: SV = Earned Value (EV) – Planned Value
(PV) If the resulting schedule is negative, it indicates that the project is behind schedule. A value
greater than 0 shows that the project is ahead of the planned schedule. A value of 0 indicates that
the project is right on target.
Answer option A is incorrect. The negative SV means that project is behind the schedule.
Answer option C is incorrect. The zero SV means that project is right on target.
Answer option B is incorrect. This result can be drawn by looking at the cost variance (CV) of the
project. What is CV? Cost variance (CV) is a measure of cost performance on a project. The
variance notifies if costs are higher than budgeted or lower than budgeted. The cost variance is
calculated based on the following formula: CV = Earned Value (EV) – Actual Cost (AC) A positive
value means that spending is less than budgeted, whereas a negative value indicates that costs
are higher than originally planned for the project.