Formulas

Project Management Quick Formula Reference

Network Diagram
Activity Duration = EF – ES + 1 or Activity Duration = LF – LS + 1
Total Float = LS – ES or Total Float = LF – EF
Free Float = ES of Following – ES of Present – DUR of Present
EF = ES + duration – 1
ES = EF of predecessor + 1
LF = LS of successor – 1
LS = LF – duration + 1

Earned Value
CV = EV – AC
CPI = EV / AC
SV = EV – PV
SPI = EV / PV
EAC ‘no variances’ = BAC / CPI
EAC ‘fundamentally flawed’ = AC + ETC
EAC ‘atypical’ = AC + BAC – EV
EAC ‘typical’ = AC + ((BAC – EV) / CPI)
ETC = EAC – AC
ETC ‘atypical’ = BAC – EV
ETC ‘typical’ = (BAC – EV) / CPI
ETC ‘flawed’ = new estimate
Percent Complete = EV / BAC * 100
VAC = BAC – EAC
EV = % complete * BAC

PERT
PERT 3-point = (Pessimistic+(4*Most Likely)+Optimistic)/6
PERT σ = (Pessimistic – Optimistic) / 6
PERT Activity Variance = ((Pessimistic – Optimistic) / 6)^2
PERT Variance all activities = √sum((Pessimistic – Optimistic) / 6)^2

Project Selection
PV = FV / (1+r)^n
FV = PV * (1+r)^n
NPV = Formula not required. Select biggest number.
ROI = Formula not required. Select biggest number.
IRR = Formula not required. Select biggest number.
Payback Period = Add up the projected cash inflow minus expenses
until you reach the initial investment.
BCR = Benefit / Cost
CBR = Cost / Benefit
Opportunity Cost = The value of the project not chosen.

Depreciation
Straight-line Depreciation:
Depr. Expense = Asset Cost / Useful Life
Depr. Rate = 100% / Useful Life
Double Declining Balance Method:
Depr. Rate = 2 * (100% / Useful Life)
Depr. Expense = Depreciation Rate * Book Value at Beginning of Year
Book Value = Book Value at beginning of year – Depreciation Expense
Sum-of-Years’ Digits Method:
Sum of digits = Useful Life + (Useful Life – 1) + (Useful Life – 2) + etc.
Depr. rate = fraction of years left and sum of the digits (i.e. 4/15th)

Communications
Communication Channels = n * (n-1) / 2
Probability
EMV = Probability * Impact in currency
Procurement
PTA = ((Ceiling Price – Target Price) / Buyer’s Share Ratio) + Target Cost

Mathematical Basics
Average (Mean) = Sum of all members divided by the number of items.
Median = Arrange values from lowest value to highest. Pick the middle one. If there is an even number of values, calculate the mean of thetwo middle values.
Mode = Find the value in a data set that occurs most often.

Values
1 sigma = 68.26%
2 sigma = 95.46%
3 sigma = 99.73%
6 sigma = 99.99%

Control Limits = 3 sigma from mean
Control Specifications = Defined by customer; looser than the control limits
Order of Magnitude estimate = -25% to +75%
Preliminary estimate = -15% to + 50%
Budget estimate = -10% to +25%
Definitive estimate = -5% to +10%
Final estimate = 0%
Float on the critical path = 0 days
Pareto Diagram = 80/20
Time a PM spends communicating = 90%
Crashing a project = Crash least expensive tasks on critical path.
JIT inventory = 0% (or very close to 0%.)
Minus 100 = (100) or -100

Acronyms
AC – Actual Cost
BAC – Budget at Completion
BCR – Benefit Cost Ratio
CBR – Cost Benefit Ratio
CPI – Cost Performance Index
CV – Cost Variance
DUR – Duration
EAC – Estimate at Completion
EF – Early Finish
EMV – Expected Monetary Value
ES – Early Start
ETC – Estimate to Complete
EV – Earned Value
FV – Future Value
IRR – Internal Rate of Return
LF – Late Finish
LS – Late Start
NPV – Net Present Value
PERT – Program Evaluation and Review Technique
PTA – Point of Total Assumption
PV – Planned Value
PV – Present Value
ROI – Return on Investment
SPI – Schedule Performance Index
SV – Schedule Variance
VAC – Variance at Completion
σ Sigma / Standard Deviation
^  “To the power of” (2^3 = 2*2*2 = 8)