Enter the total earned value and the actual cost into the calculator to determine the cost variance.
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Cost Variance Formula
The following formula is used to calculate a cost variance.
CV = EV - AC
- Where CV is the cost variance ($)
- EV is the earned value ($)
- AC is the actual cost ($)
To calculate the cost variance, subtract the actual cost from the earned value.
Cost Variance Definition
Cost variance is defined as the difference between an earned value and the actual cost of a good.
Cost Variance Example
How to calculate cost variance?
- First, determine the earned value.
Determine the total budget that is estimated for the project.
- Next, determine the actual cost.
After the project is completed, analyze and calculate the actual total cost.
- Finally, calculate the cost variance.
Subtract the actual cost from the earned value to determine the cost variance.
FAQ
Cost variance is a difference between a budgeted cost of a job or work and the actual cost of that job after completion.
Earned value is considered the amount of monetary value budgeted for a certain project.
