# Example with formular Variance at Completion, Estimate to Complete (ETC) and To Complete Performance Index (TCPI)

### 10. Variance at Completion

Formula: Variance at Completion = Budget at Completion – Estimate at Completion

Variance at Completion calculates how much the project budget is accurate to the planned budget. This will help you to plan and estimate requirements more accurately.

If the Budget at completion was \$20,000 and you find that the Estimate at completion is \$25,000, then you could calculate the Variance at completion by calculating:

Budget at Completion – Estimate at Completion

20000 – 25000 = -5000

You will get at Variance at Completion of –5000.  Which means the project is going beyond the initial budget by \$5000

### 11. Estimate to Complete (ETC)

Formula: Estimate to Complete = Estimate at Completion – Actual Cost

Estimate to Complete or ETC is a measure of how much funds will be required to complete the remaining work. This will help you by giving a dynamic value that is more accurate than your initial estimates.

For example, if the Estimate to complete is calculated at \$25,000 and the Actual Cost incurred is \$10,000. In this case you can calculate the Estimate to Complete as follows.

Estimate at Completion – Actual Cost

25000 – 10000

=\$15,000

This means that you will need \$15,000 at this point to successfully complete the project.

### 12. To Complete Performance Index (TCPI)

Formula:

TCPI = (Budget at Completion – Earned Value) / (Estimate at Completion – Actual Cost)

TCPI = (Budget at Completion – Earned Value) / (Budget at Completion – Actual Cost)

To Complete Performance Index (TCPI) gives the cost performance required to meet project goals based on the budget that is available.  If the Budget at completion is \$20,000, Estimate at Completion is \$25,000, Earned Value is at \$10,000 and Actual Cost is at \$ 12,000. In this situation we would calculate TCPI as (Budget at Completion – Earned Value) / (Estimate at Completion – Actual Cost)

(20000-10000)/ (25000-12000)

= 10000/13000 = 0.77

The TCPI would be at 0.77

## Example with formular Present Value (PV), Future Value (FV), Target Price and Point of Total Assumption

22. Present Value (PV) Formula: PV = Future Value / (1 + i)n   Present Value (PV) considers the time value of money. This is useful to calculate what a future amount of money would mean today if adjusted for time. ‘i’ represents the interest rate or the discounting rate. ‘n’ represents t...

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## Example with formular Standard Deviation, Communication Channels and Cost plus Percentage of Cost

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## 25 PMP Formulas you must remember to pass the PMP exam

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 ...

## Example with formulas Earned Value, Cost Variance and Schedule Variance

4. Earned Value Formula:  EV = % Complete x Budget at Completion   Earned Value estimates the amount of work done in terms of monetary value.   It is calculated by multiplying the percentage of work completed and the project value represented by budget at completion.   If the Bu...