1. What is the EAC Formula?

The Estimate at Completion (EAC) formula is a key metric in Earned Value Management (EVM) that forecasts the total project cost based on current performance. It provides a projection of what the total project will cost given the current cost efficiency.

2. How Does the Calculator Work?

The calculator uses the EAC formula:

Where:

• \( BAC \) — Budget at Completion (original project budget in $)
• \( CPI \) — Cost Performance Index (dimensionless ratio)
• \( EAC \) — Estimate at Completion (projected total cost in $)

Explanation: The formula divides the original budget by the cost performance index to estimate the final project cost. A CPI < 1 means the project is over budget.

3. Importance of EAC Calculation

Details: EAC helps project managers forecast final costs, make informed decisions about resource allocation, and communicate realistic expectations to stakeholders.

4. Using the Calculator

Tips: Enter BAC in dollars, CPI as a decimal (e.g., 0.95 for 95% efficiency). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's a good CPI value?
A: CPI > 1 indicates under budget, CPI = 1 is on budget, CPI < 1 is over budget. Values between 0.9-1.1 are typically acceptable.

Q2: How often should EAC be calculated?
A: EAC should be calculated regularly (weekly or monthly) as part of project performance reviews.

Q3: What if CPI changes during the project?
A: Recalculate EAC whenever CPI changes significantly to maintain accurate forecasts.

Q4: Are there other EAC formulas?
A: Yes, alternative formulas exist for different scenarios (e.g., when future work will be at planned rate).

Q5: How does EAC relate to ETC?
A: Estimate to Complete (ETC) is EAC minus Actual Cost (AC), showing remaining costs to finish the project.