Which equation defines Cost Variance (CV) and Schedule Variance (SV) in Earned Value Management?

Which equation defines Cost Variance (CV) and Schedule Variance (SV) in Earned Value Management?

• A. CV = EV - AC; SV = EV - PV.
• B. CV = PV - EV; SV = EV - AC.
• C. CV = EV + AC; SV = PV - EV.
• D. CV = EV - PV; SV = EV - AC.

Answer: (A)

In Earned Value Management, you assess performance by comparing the value of work actually completed to what was planned and to what was spent. Cost Variance reflects whether you’re on budget by comparing earned value to actual cost. A positive value means you’ve earned more value than you’ve spent (under budget); a negative value means you’ve spent more than the value of work done (over budget). Schedule Variance shows whether you’re ahead or behind schedule by comparing earned value to planned value. A positive value means you’ve completed more value than planned (ahead of schedule); a negative value means you’re behind. The standard formulas are CV = EV − AC and SV = EV − PV. This uses earned value as the baseline to assess cost performance against actual spend, and to assess schedule performance against what was planned. Other forms mix the references or signs, which would not consistently reflect cost or schedule status.

In Earned Value Management, you assess performance by comparing the value of work actually completed to what was planned and to what was spent. Cost Variance reflects whether you’re on budget by comparing earned value to actual cost. A positive value means you’ve earned more value than you’ve spent (under budget); a negative value means you’ve spent more than the value of work done (over budget). Schedule Variance shows whether you’re ahead or behind schedule by comparing earned value to planned value. A positive value means you’ve completed more value than planned (ahead of schedule); a negative value means you’re behind.

The standard formulas are CV = EV − AC and SV = EV − PV. This uses earned value as the baseline to assess cost performance against actual spend, and to assess schedule performance against what was planned. Other forms mix the references or signs, which would not consistently reflect cost or schedule status.