Formulas for the CAPM
 Written by Mauricio Cacciavillani
 Published in General
 Hits: 3439
Make sure you remember all this formulas for the exam.
1. PERT 
(P + 4M + O )/ 6 Pessimistic, Most Likely, Optimistic 
2. Standard Deviation 
(P  O) / 6 
3. Variance 
[(P  O)/6 ]squared 
4. Float or Slack 
LSES and LFEF 
5. Cost Variance 
EV  AC 
6. Schedule Variance 
EV  PV 
7. Cost Perf. Index 
EV / AC 
8. Sched. Perf. Index 
EV / PV 
9. Est. At Completion (EAC) 
BAC / CPI, AC + ETC  Initial Estimates are flawed AC + BAC  EV  Future variance are Atypical AC + (BAC  EV) / CPI  Future Variance would be typical 
10. Est. To Complete Percentage complete 
EAC  AC EV/ BAC 
11. Var. At Completion 
BAC  EAC 
12. To Complete Performance Index (TCPI) 
Values for the TCPI index of less then 1.0 is good because it indicates the efficiency to complete is less than planned. How efficient must the project team be to complete the remaining work with the remaining money? ( BAC  EV ) / ( BAC  AC ) 
13. Net Present Value 
Bigger is better (NPV) 
14. Present Value PV 
FV / (1 + r)^n 
15. Internal Rate of Return 
Bigger is better (IRR) 
16. Benefit Cost Ratio 
Bigger is better ((BCR or Benefit / Cost) revenue or payback VS. cost) Or PV or Revenue / PV of Cost 
17. Payback Period 
Less is better Net Investment / Avg. Annual cash flow. 
18. BCWS 
PV 
19. BCWP 
EV 
20. ACWP 
AC 
21. Order of Magnitude Estimate 
25%  +75% (50 to +100% PMBOK) 
22. Budget Estimate 
10%  +25% 
23. Definitive Estimate 
5%  +10% 
24. Comm. Channels 
N(N 1)/2 
25. Expected Monetary Value 
Probability * Impact 
26. Point of Total Assumption (PTA) 
((Ceiling Price  Target Price)/buyer's Share Ratio) + Target Cost 
Sigma σ 

Return on Sales ( ROS ) 
Net Income Before Taxes (NEBT) / Total Sales OR Net Income After Taxes ( NEAT ) / Total Sales 
Return on Assets( ROA ) 
NEBT / Total Assets OR NEAT / Total Assets 
Return on Investment ( ROI ) 
NEBT / Total Investment OR NEAT / Total Investment 
Working Capital 
Current Assets  Current Liabilities 
Discounted Cash Flow 
Cash Flow X Discount Factor 
Contract related formulas 
Savings = Target Cost – Actual Cost 
Critical Path formulas
Forward Pass: (Add 1 day to Early Start)
EF = (ES + Duration  1)
Backward Pass: (Minus 1 day to Late Finish)
LS = (LF  Duration + 1)
ES = Early Start; EF = Early Finish;
LS = Late Start; LF = Late Finish
EVA = Net Operating Profit After Tax  Cost of Capital (Revenue  Op. Exp  Taxes)  (Investment Capital X % Cost of Capital) EVA  Economic Value Add Benefit Measurement  Bigger is better
Source Selection = (Weightage X Price) + (Weightage X Quality)