Project Cost Forecasting
Compare alternative Estimate at Completion forecasts, understand the assumptions behind each method, calculate Estimate to Complete and Variance at Completion, and select a forecast that reflects the expected conditions for the remaining work.
Forecast the Final Cost by Making the Assumption Explicit.
Project cost forecasting is not a single-formula exercise. Different Estimate at Completion methods answer different questions because each one assumes something different about the remaining work. This demonstration compares four common forecasting approaches and shows how the choice of assumption changes the forecast.
- Review BAC, PV, EV, AC, and a bottom-up ETC estimate.
- Calculate CPI and SPI as the performance basis for forecasting.
- Forecast EAC when remaining work is expected to perform at the original budgeted rate.
- Forecast EAC when current CPI is expected to continue.
- Forecast EAC when both cost and schedule inefficiency are expected to influence remaining work.
- Build a bottom-up EAC from a revised ETC estimate.
- Compare ETC and VAC across all forecasting methods.
- Select the method that best matches the expected remaining-work conditions.
Project Cost Forecasting — Step by Step
Complete each locked stage before the next unlocks. Every reveal changes the forecast dashboard so each method, result, and assumption remains visible beside the learning step.
Review the Forecast Source Data
EAC Scenarios, ETC, VAC and Assumptions
Forecast source data are revealed one value at a time.
Focus Mode moves you to the Guided Demonstration, then hides the rest of the page while keeping the current learning stage and forecast dashboard visible together. Zoom affects only the visual pane.
Cost Forecast Methods
Forecast rows appear progressively with the guided sequence. The assumption behind each method is shown with its result.
| Forecast / Measure | Formula | Result | Assumption / Interpretation |
|---|
Change the Performance Data and Forecast Assumption
Experiment Mode is isolated from the guided example. Change the project status values and bottom-up ETC, then select a forecast method to see the resulting EAC, ETC, VAC, and interpretation.
Quick Knowledge Check
Forecast Methods and Assumptions
| Method | Formula | Use When |
|---|---|---|
| Budgeted-rate EAC | EAC = AC + (BAC − EV) | Past variance is treated as atypical and remaining work is expected to perform at the original budgeted rate. |
| CPI-based EAC | EAC = BAC / CPI | Current cost efficiency is expected to continue. |
| CPI × SPI EAC | EAC = AC + (BAC − EV) / (CPI × SPI) | Both cost and schedule inefficiency are expected to influence remaining work. |
| Bottom-up EAC | EAC = AC + Bottom-up ETC | The remaining work has been re-estimated in detail and the new ETC is considered more credible than a performance-index extrapolation. |
| ETC | ETC = EAC − AC | Forecast additional cost required from the status date to completion. |
| VAC | VAC = BAC − EAC | Expected final budget variance; negative indicates a forecast overrun. |