A second method for determining the forecasted cost at completion assumes that, regardless of the efficiency rate the project or work package has experienced in the past, the work to be performed on the remaining portion of the project or work package will be done according to budget.If the cumulative actual cost is greater than the cumulative earned value, then
A) the FCAC is greater than the TBC.
B) the FCAC is less than the TBC.
C) the FCAC cannot be calculated with the values given.
D) additional information is needed to predict the FCAC.

Question

Quizplus · Accepted Answer

When the cumulative actual cost is greater than the cumulative earned value, it indicates that the project is over budget. Assuming future work will be completed according to the original budget, the forecasted cost at completion (FCAC) will be greater than the total budgeted cost (TBC) because it will include the overage already incurred.

A Second Method for Determining the Forecasted Cost at Completion