Question

A software development project was planned to be completed in 12 months. The review of the project after eight months revealed that Rs. 120000 was spent on the project for 48% of project completion. Consider total project budget as Rs 240000. Calculate and explain the schedule and cost performance index for this situation.

Answer 1

Answer:

CPI = 0.96

Explanation:

The project is lagging behind the schedule as 50% of the project should have been completed in 6 months whereas only 48% was completed in 8 months. This means that project will get late by around 6 months.

For CPI, the formula for cost performance index is given as;

Budget at Completion = Estimated budget x CPI

Here;

Estimated budget  = 2400000

Budget at completion = 100 / 48 x 120000 = 250000

CPI = 240000 / 250000

CPI = 0.96