Your project sponsor has asked you and your team to refine the existing cost estimate for the project so that there is a solid cost baseline for evaluating project performance. Recall that your schedule and cost goals are to complete the project in six months or less for under $500, 000. Initial estimates suggested that about $300,000 for this project would go toward internal labor. You mistakenly thought that travel costs would be included in that $300,000, but now you realize that it is a separate cost item. The one trip to England early in the project cost $6,000, which you had not expected.

Tasks
1. Prepare and print a one-page cost estimate for the project. Use the WBS categories you created earlier, and be sure to document assumptions you make in preparing the cost estimate. Assume a burdened labor rate of $100/hour for the project manager, $90 for Teresa, James, and Le, and $80/hour for Matt. Assume about $200/hour for outsourced labor.

2. Using the cost estimate you created in task 1, prepare a cost baseline by allocating the costs by WBS for each month of the project.

3. Assume you have completed three months of the project and have actual data. The BAC was $500,000 for this six-month project. Also assume the following:
PV= $160,000
EV= $150,000
AC= $180,000

Using this information, write a short report that answers the following questions:

a. What is the cost variance, schedule variance, cost performance index (CPI), and schedule performance index (SPI) for the project?
b. Use the CPI to calculate the estimate at completion (EAC) for this project. Use the SPI to estimate how long it will take to finish this project. Sketch an earned value chart using the above information, including the EAC point. Write a paragraph explaining what this chart shows.
c. How is the project doing? Is it ahead of schedule or behind schedule? Is it under budget or over budget? Should you alert your sponsor or other senior management and ask for assistance?