Understand Project Costs…  How much will the project cost?  Are we on budget?  How much have we spent on materials versus labor?

Work Resources  This is how work gets done on projects.  What are some work resources?  People and equipment  Work resources consume time [hours or days] to accomplish tasks and our calculated as costs against the project.

3 Basic Cost Types…  Resource rates The cost of a work resource based on the amount of time that the resource spends working on the project.  Fixed costs One total cost that represents the price for doing a task or project, regardless of the number of resources assigned, the number of hours worked, or the amount of materials used.  Per-use costs The single amount that it costs each time you use a resource.

Which cost type to use?  Often, you will use a combination of these cost-tracking strategies in your project. In most cases, the cost is determined by the pay rates for resources or the cost of materials, so you'll want to use resource rates to track most costs. However, if a vendor gives you a fixed cost to do a task, then you will want to assign a fixed cost to that task.

Set rates for each task  Standard rate can be applied to each task within an objective.  Standard rates are based on experience, market, and negotiation.  Rates x Hours will equal the task cost  Task Costs added together will create the sub-total objective cost.

OBJECTIVE SUB TOTALS BUDGET OBJECTIVE 1.1HoursRateTotal Task $25$125 Task $12$36 Task $30$450 SUB-TOTAL$611

Summary  Work Resources (People, Equipment)  Rates, 3 basic types (Resource, Fixed, Per Use)  Determining your task cost type  Setting Rates for tasks  Calculating Objective Sub Totals  Questions…