Your project to obtain charitable donations is now 30 days into a planned 40-day
ID: 364596 • Letter: Y
Question
Your project to obtain charitable donations is now 30 days into a planned 40-day project. The project is divided into 3 activities. The first activity is designed to solicit individual donations. It is scheduled to run the first 25 days of the project and to bring in $25,000. Even though we are 30 days into the project, we still see that we have only 90 percent of this activity complete. The second activity relates to company donations and is scheduled to run for 30 days starting on day 5 and extending through day 35. We estimate that even though we should have approximately 83 percent (or more precisely 25/30) of this activity complete, it is actually only 50 percent complete. This part of the project was scheduled to bring in $150,000 in donations. The final activity is for matching funds. This activity is scheduled to run the last 10 days of the project and has not started. It is scheduled to bring in an additional $50,000. So far $175,000 has actually been brought in on the project.
1) Draw a picture of what this would look like.
Explanation / Answer
Total Planned Value = $225000
Planned Value = [left ( rac{90}{100} * 25000 ight ) + left ( rac{83}{100} * 150000 ight )] = $147000
Actual Value = $175000
Earned Value = [left ( rac{90}{100} * 25000 ight ) + left ( rac{50}{100} * 150000 ight )] = 22500 + 75000 = $97000
Scheduled Variance = Earned Value - Planned Value
i.e. 97000 - 147000 = - 50000
Cost Variance = Earned Value - Actual Value
i.e. 97000 - 175000 = - 78000
Schedule Performance Index = [ rac{Earned Value}{Planned Value}] = 0.660
Cost Performance Index = [ rac{Earned Value}{Actual Value}] = 0.554
Hence,
Schedule Variance = $-50000
Schedule Performance Variance = 0.660
Cost Variance = $-78000
Cost Performance Variance = 0.554
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