CCP Exam Simulation 1 Review

• The quiz reviews concepts from CCP Exam Simulation 1.

Estimation Classes & Accuracy Ranges

• If project definition is at 8%, a Class 4 estimate is appropriate
• For bidding purposes, a Class 2 -Definitive Estimate is recommended
• An estimate with -5% to +15% accuracy falls under Class 1 - Definitive Estimate
• An estimate prepared using the Capacity factor method is a Class 5 estimate

Effort & Estimation Techniques

• An estimate that requires the least effort to prepare is ROM (Rough Order of Magnitude).
• Physical Dimension Estimation: Lagoon Park sidewalk (1,048 ft x 6 ft) cost $75,287; King Park sidewalk (4,500 ft x 6 ft) will cost $323,190

Earned Value Management (EVM)

• The formula to calculate cost variance is BCWP (Budgeted Cost of Work Performed) - ACWP (Actual Cost of Work Performed)
• This refers to a scenario (CEC-A3) where work packages 1 to 6 should have been 100% completed according to plan with provided ACWP, progress, and BCWS figures
  • BAC (Budget at Completion) is 147
  • BCWS (Budgeted Cost of Work Scheduled) is 92.
  • ACWP (Actual Cost of Work Performed) is 75
  • BCWP (Budgeted Cost of Work Performed) is 69.7
  • SV (Schedule Variance) is -22.3.
  • CV (Cost Variance) is -5.3
  • SPI (Schedule Performance Index) is 0.758.

Project Analysis & Schedule Overrun

• Schedule analysis showing a high likelihood of schedule overrun means cumulative BCWP is much lower than cumulative BCWS

Capacity Factor Method

• $B = ($A) (CapB / CapA)e is the equation for Capacity Factor Method
• Exponent range typically used for the capacity factor method is 0.5 to 0.85
• Using the Capacity Factor Method offers with Class 5 accuracy per AACE International

Project Cost & other Factors

• Increasing the exponent/proration factor will further increase the new project cost

Scenario (CEC-A2)

• Engineering company project with an original budget is 160,000 hours, valued at $15,000,000
  • Planned hours 65,000
  • Actual hours to date 73,000
  • % complete 40%
  • Earned Hours for the project is 64,000
  • Cost Variance is +9,000
  • Schedule Variance is +1,000
  • CPI (Cost Performance Index) is 0.88
  • SPI (Schedule Performance Index) is 0.98
  • The forecast work hours to complete (EAC) are at 181,818
  • Status of the project is Schedule unfavorable, Cost unfavorable

TVM Concepts

• $1,000 in a savings account with 6% interest yields $1,060 after one year
• Receiving $25,000 after 10 years equates to a present value of $13,318, assuming a 6.5% annual interest rate
• Money doubles in 7.2 years with a 10% annual interest rate, compounded annually
• One must deposit $34,030 for 5 years at 8% interest to obtain a net of $50,000 after $50 early withdrawal fees
• Depositing $1000 in a savings account at the end of each year for the next 10 years; a bank paying 12% interest per year will yield $17,549 at the end of the 10-year period
• Investing in a bank scheme offering 12% per year interest to withdraw $12,000 per year for 20 years, one should invest $89,628 now
• A money that $ 8000 invested in an account with 8.5% interest per year, compounded quarterly will result in $11,199.60 after 4 years
• Depositing savings at 12% compounded annually to provide for ten annual withdrawals will start at $6000 and decrease by $500 each year need &23,773

Investments

• The EUAC (Equivalent Uniform Annual Cost) of machine with $30000 initially cost + $3000 salvage value + $1000 maintenance cost (increasing $200 each year) + $800 operating cost= is $7761
• Economic Analysis should usually made After-tax basis + add back depreciation (if any)
• Borrowing $5000 with 7% simple interest, repaying after 4 years means paying back $6,400

Cost of Computer System

• A computer system with $18000 purchase + $10000 operating costs/year + expected 5-year life + $5000 salvage value will have Net Present Worth $1405
  • Company's tax rate 50% & using straight-line depreciation with 10% MARR
  • The present worth of Benefit is $19405
  • The taxable income in year 3 is $3400
  • The tax paid at the end of year 5 is $8500 (Cumulative)
  • Applicable factor for P/A is 3.791
  • Correct factor for P/F is 0.6209
  • Book value of the computer at the end of year 3 stands at $10200

Real Estate Investments

• Investing for a house that could be rented out for $600 per month (paid annually) + $1200 for taxes + tenant pay for utilities + sold for $85000 after 5 years (MARR 12%) is 69511$ is the largest amount that the investor can offer for the property if his MARR is 12%
  • Functional notations: P/F and P/A
  • Correct factor to find present worth of annuity: 3.605
  • Correct factor to find present worth of future worth: 0.567.
  • With Taxes and Maintenance expenses to be borne by the buyer, will decrease the buying price
  • Recommended buying price: $69000.

Crane Leasing

• A leasing company evaluated two cranes with given data for both: Purchase Cost, Salvage Value, Income / Year, Expense / Year, and using depreciation straight-line depreciation with 12% MARR is all to consider
  • The Book value for Brand A at the end of Year 3 is 122500
  • the company should choose Brand A
  • The NPW for Brand B is $56200
  • Tax payable at year end for Brand A is $9717
  • The present worth of the salvage value for Brand B is $16211
  • Annual taxable income for Brand A is $44167
  • If the brand gives higher NPW the statement above is true as it relates to this case

Miscellaneous Calculations

• Using project budget $86,000 + 0.95 CPI + work progress and budgeted cost of work performed: $26424= Estimate to Complete is 59576 when remaining work will be performed at budget rate?
  • 80MW Plants estimated at 1.41 while 62MW capacity was 1.2Million. & exponent factor assumed to be around 0.64
  • the project budget is $ 80000 and work progress is 62% so Budgeted Cost of Work Performed reaches 49,600
  • iron cost $ 12000 at the end of year 4 so what is price of iron at the end of year 5 equals roughly 13680

Project Managment

• Accuracy range of definitive estimate is -5% to 15% -Class 5 and Class 4 estimates use conceptual estimating methodologies

Pricing

• Adjustment to cost to allow for overhead and profit, to improve cash flow is Pricing
• Tasks which entail sub tasks in a sequential manner use "Incremental Milestone" method is suitable for work progress measure

Project Completion & Standards

• Optimistic estimate (24 days)and pessimistic estimate (36 days) results in standard deviation ~2
• If the variance is 8, than standard deviation stands at 2.8
• Organisation should be committed to addressing the management of risk: proactively and consistently throughout the project.

Total Project Cost

• What does cost of quality mean equals the total cost of all quality-related activities
• With a project budget of $80000 and the progress at 62%, the Budgeted cost of work performed stands at 49,600
• In total revenue breakeven point equals to variable cost plus fixed cost

Estimating

• AACE international Class 1 & Class 2 falls under Definitive estimate classification based on ANSI.

Project Status - CPI

• When Project's CPI has the value 0.92, indicating that Project has overrun its budget

Depreciation

• Sunk cost method isn't a common depreciation techniques

Project Selection

• Selecting project: based on IRR (Internal Rate of Return) satisfies IRR> MARR

Project Records

• As simple project records showing the implementation start and finish dates then known as: As-Built Schedule
• Creating fund: deposits that the total amount (usually made equally) for making compound interest order sum to the same number as specific purpose =Sinking Fund

Project Causes & Types

• The "pareto chart" is type in histogram type show many defects by type / categorize the causing part.
• What kind of code or note show any activity or code / task equal Activity Code.

Time Completion

• What activities need the times to be done by the activity to find each the ES and EF and end equal Forwand Pass
• What level shows schedule for simple event or important point is equal to level one

Project Management

• Project team members should report both to manager.

Project Timeline

• To show every sub task in the order list the time are going to have to make what kind of schedule used which is list 2 times.

Construction Planning

• Construction project aims are trying reduce the cost when consider the make other types design or set.

Motivations

• Motivational theory use every side x and side way is made by McGregor

Contracts

• Contracts which one list every base time type (typically) show cost-plus+ and fixed time
• Advantage price fixed show less time than what was quoted

Scheduling

• The assigning of started and finished times to reach work completion time within the limit time what you want the activity that is Scheduling
• Software work that will not start until finish is Finish-to-Start relationship

PERT

• Arrow Diagramming Method, Precedence Diagramming Method & Activity On Arrow are the methods of critical path scheduling

Float

• Free float equals the amount the end of finish activity without having to change the other one.

Contingencies

• To plan amount to allow what is the state will cost you more on each condition equal contingengy.

Project Delivery Time

• Project that will help to have it in right amount of time and it with: Design/Build
• Sum of process for how team use make work at each level equal is: Total Cost Management
• What kind of relation mean each one have some process or same way is SS