| Purpose | Formula | Description |
| Calculate Beta Value in PERT (Program Evaluation and Review Technique) | Beta = (Pessimistic + 4 Most Likely + Optimistic) / 6 | This equation finds the expected value by giving weightage to the most likely Value. |
| Calculate Estimated Monetary Value (EMV) | EMV = P x I | This is used to identify and manage risk in projects. P is the probability of an event happening and I is the impact it can have in monetary terms. |
| Calculate Risk Priority Number (RPN) | RPN = Severity x Probability x Detection | RPN is a value to rank risks. It is a direct multiplication of the three values. |
| Calculate Earned Value (EV) | EV = % Complete x Budget at Completion | Budget at Completion is the total project value. Simply put, it is the estimated cost of all the work to be completed during the project. |
| Calculate Cost Variance (CV) | CV = Earned Value – Actual Cost | This measures the difference between the budgeted costs and the actual costs |
| Calculate Schedule Variance (SV) | SV = Earned Value – Planned Value | This checks the value of the actual work against the planned progress |
| Calculate Cost Performance Index (CPI) | CPI = Earned Value / Actual Cost | CPI is an indicator if the project is going as per budget |
| Calculate Schedule Performance Index (SPI) | SPI = Earned Value / Planned Value | The Schedule Performance Index measures how efficient the project schedule is. |
| Calculate Estimate at Completion (EAC) | EAC = Budget at Completion / Cost Performance Index EAC = Actual Cost + Bottom –up Cost to Complete EAC = Actual Cost + (Budget at Completion – Earned Value) EAC = Actual Cost + [(Budget at Completion – Earned Value) / (Cost performance Index x Schedule Performance Index)] |
Estimate at Completion is an indicator that forecasts the actual budget that may be needed at the current stage. It can be calculated as per any of the four methods. |
| Calculate Variance at Completion | Variance at Completion = Budget at Completion – Estimate at Completion | It estimates additional budget required or a surplus that would be available at the completion of the project |
| Calculate Estimate to Complete (ETC) | TCPI = (Budget at Completion – Earned Value) / (Estimate at Completion – Actual Cost) TCPI = (Budget at Completion – Earned Value) / (Budget at Completion – Actual Cost) |
TCPI tells the project manager the cost performance that is required to complete the project. |
| Calculate Standard Deviation | Standard Deviation (σ) = (Pessimistic – Optimistic) / 6 | Standard deviation indicates how reliable the estimated values are and how likely they are to vary during the actual project |
| Calculate Communication Channels | Communication Channels = n(n-1) / 2 | This formula lets you understand the number of communication channels needed in a project. Here n is the number of stakeholders involved in the project |
| Calculate Cost plus Percentage of Cost | Cost plus Percentage of Cost = Cost + n% | I pre-decided percentage of cost is added to the actual cost |
| Calculate Cost plus Fixed Fee | Cost plus Fixed Fee = Cost + n | A pre-decided amount is added to the actual cost incurred |
| Calculate Cost plus Award Fee | Cost plus Award Fee = Cost + n | A fixed fee is added to the actual cost along with reimbursements for expenses |
| Calculate Cost plus Incentive Fee | Cost plus Incentive Fee = Cost + n | In addition to the cost an incentive is paid if the project is done within the budget or at a lower cost |
| Calculate Return on Investment (ROI) | ROI = (Net Profit / Cost of Investment) x 100 | This indicates how investment in a project is performing |
| Calculate Payback Period | Payback Period = Initial Investment / Periodic Cashflow | This refers to the time required to recover the funds invested in a project |
| Calculate Cost Benefit Ratio | Cost Benefit Ratio = Net Present Value of Investment / Initial Investment Cost | It is a number that measures the monetary benefits of a project against the cost involved in it |
| Calculate Present Value (PV) | PV = Future Value / (1 + i)n | This considers the time value for money and discounts from the future value. “i” represents the interest rate and n represents the time periods. |
| Calculate Future Value (FV) | FV = Present Value x (1 + i)n | Used to measure value at a future date. “i” represents the interest rate and n represents the time periods. |
| Calculate Target Price | Target Price = Target Cost + Target Fee | This is a price arrived by both the buyer and seller |
| Calculate the Point of Total Assumption | PTA = [(Ceiling Price — Target Price) / Buyer’s Share Ratio] + Target Cost | This is the cost above which the seller will have to bear the additional costs incurred |