A project has just completed its 87th item in the project pl

A project has just completed its 87^th item in the project plan. It was scheduled to have spent $168,000 at this point in the plan, but has actually spent only $156,000. The project manager estimates that the value of the work actually finished is nearly $162,000. What are the spending and schedule variances for the project? What are the SPI and CPI?

Solution

Actual cost of work performed (ACWP) = $156,000

Budgeted cost of work performed (BCWP) = $162,000

Budgeted cost of work schedule (BCWS) = $168,000

Cost/spending variance = BCWP – ACWP = $162,000 – 156,000 = $6,000

Schedule variance = BCWP – BCWS = $162,000 – 168,000 = - $6,000

Schedule Performance Index (SPI) = BCWP/BCWS = $162,000/168,000 = 0.964

Cost Performance Index (CPI) = BCWP/ACWP = $162,000/156,000 = 1.038