Question 2 10 points You are working for an international construction company.

Question

Question 2 10 points You are working for an international construction company. Your project involves pulling together over 13 diflerent subprojects.You are having dilficulty in ensuring three subcontractors are doing their work correctly. As you review the project results, you notice you have spent US $1,200,000 at the last reporting point. You know the schedule is not too bad, since your schedule performance index (SPI) is 1.1. Considering you feel you should have spent US $1,300,00 to this point, what are the cost performance index (CPI), and the schedule and cost variances? 1.19 $230.000, and $230,000) O 1.19, $130,000, and $230,000 1.43, $130,000, and $130,000) 1.1, ($230.000), and $130,000

Explanation / Answer

CPI = Earned Value/Actual cost

Actual cost = (1/1.1)*1200000= 1200000/1.1

CPI = 1300000/(1200000/1.1) = 1.192 = 1.19(rounding off)

Schedule Variance = Cost of work performed - Cost of work scheduled

= (1200000/1.1)- 1300000 = -209090

Cost variance = =1300000/1.1 - 1200000 = 1181818.18-1200000 = -18181.82

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