The Estimate At Completion (EAC) and how to calculate it

Once you have viewed the video, click here to try this easy question:
Fred, the project manager is discussing with the project controller Stacy and they are estimating the future budget needs for their project. They feel that many of the reasons for cost deviations so far will continue to impact the project since they are due to permanent changes. Which formula should Fred and Stacy use?

A) EAC = BAC + AC – EV.
B) They should do a new bottom up estimate since that is the only way to know for sure how much the project will cost.
D) …hmmm let me go back and review the video again… 😉

Do you think you know the answer? Check it here:
The right answer of course is: C.

Since the current deviations are expected to continue impacting the future costs these should be taken in consideration. CPI is the measure of the current impact on costs.