On a sewer lining package, earned value for completed work is less than the actual cost spent. How should cost variance be interpreted?
Select an answer to reveal the explanation.
Short Explanation
If you have spent more than the value you have earned, the wallet is underwater versus the work done—that is negative cost variance. Earned versus actual is the cost scoreboard, separate from the schedule scoreboard.
Full Explanation
Cost variance is EV − AC. When actual cost exceeds earned value, CV is negative and indicates a cost overrun relative to work accomplished. Contingency presence does not force zero variance; SV remains a separate schedule metric.