How the Variance Is Worked Out
A job cost report compares what you spent with what the work you finished was supposed to cost. Four steps get from your inputs to a forecast.
1
Earned Value
Budget × percent complete. A $60,000 budget that is 50% complete has $30,000 of earned value (EV), the budgeted cost of the work done.
2
Cost Variance and CPI
CV = EV − actual cost (AC). With $40,000 spent, CV is −$10,000. CPI = EV ÷ AC = 0.75, so each dollar spent earned 75 cents of work.
3
Forecast Final Cost
If efficiency continues, forecast = budget ÷ CPI = $80,000. If the rest goes at budget, forecast = AC + budget − EV = $70,000.
4
Cost to Complete
Forecast − actual cost. At $80,000 forecast and $40,000 spent, you still expect to spend $40,000. Variance at completion is budget − forecast.
What Job Cost Variance Tells You
Spending less than budget is not the same as being under budget. A job that has spent 40% of its budget but finished only 30% of the work is behind on cost.
Earned value fixes that by pricing the work done at its budgeted cost. Cost variance then compares like with like: the value of work in place against the money it took.
The forecast is the number that matters for profit. It turns today's variance into an expected final cost, which you can compare with your contract using the construction profit margin calculator.
Variance also feeds the next budget. Update your plan in the project budget calculator when a forecast shows a category will run over.
Run this check on a schedule, such as the end of each month. A small negative variance early is a prompt, while the same number near the end of a job is a loss.
Variance Sign Conventions Compared
Different reports subtract in different directions, so the same job can show +$10,000 or −$10,000. Check the formula before you compare numbers across reports.
| Convention |
Formula |
Positive Means |
Common Use |
| Earned value cost variance | CV = EV − AC | Under budget | PMI earned value method, used here |
| Simple budget minus actual | Budget − Actual | Under budget | Basic budget vs actual reports |
| Accounting budget variance | Actual − Budget | Over budget | Expense budget reports |
| Gain or fade | Revised budget − projected final | Gain, finishing under | Job cost reports with cost to complete |
Sources: PMI earned value papers for CV, CPI, and EAC; a job cost report guide (unrated source) for gain or fade. The simple and accounting conventions are described by estimator and accounting sites.
This calculator uses the earned value sign everywhere, so a negative number always means the job is costing more than the work is worth.
Job Cost Review Scenarios
These sample calculations show how a contractor might read three jobs. They are illustrations, not documented projects.
⚠️ Slab Job Running Over
Budget: $60,000, 50% complete
Actual to date: $40,000
Method: whole job, one category
EV: $30,000; CV: −$10,000
CPI: 0.75
Forecast (efficiency continues): $80,000, over by $20,000
Forecast (rest at budget): $70,000, over by $10,000
TCPI to finish on budget: 30,000 ÷ 20,000 = 1.50
To finish at $60,000 the crew must now earn $1.50 of work per remaining dollar, versus 75 cents so far.
📋 Five-Category Contract
Contract: $215,000; budget $185,000
Job percent: 50%, with category overrides
Actual: $104,500 to date
EV: $93,000; CV: −$11,500; CPI: 0.89
Forecast (CPI, sum of categories): $206,278
Forecast (rest at budget): $196,500
Profit: $30,000 (14.0%) planned; $8,722 (4.1%) or $18,500 (8.6%) projected
Labor is the weakest category at CPI 0.80. The profit range depends on which forecast you believe.
✅ Job Ahead of Budget
Budget: $120,000, 70% complete
Actual to date: $78,000
Method: whole job, one category
EV: $84,000; CV: +$6,000
CPI: 1.08
Forecast (efficiency continues): $111,429, under by $8,571
Forecast (rest at budget): $114,000, under by $6,000
Here the budget method is the cautious one. Pick the forecast you can defend to the owner or a lender.
CPI to Forecast Final Cost Lookup
Find your CPI to see what it implies for a budget of $100,000. For other budgets, scale the result. A $250,000 budget at CPI 0.90 forecasts $277,778.
| CPI |
Forecast Final Cost |
Variance at Completion |
Reading |
| 0.80 | $125,000 | −$25,000 | Costing 25% more than the work is worth |
| 0.85 | $117,647 | −$17,647 | Over budget |
| 0.90 | $111,111 | −$11,111 | Over budget |
| 0.95 | $105,263 | −$5,263 | Slightly over budget |
| 1.00 | $100,000 | $0 | On budget |
| 1.05 | $95,238 | +$4,762 | Slightly under budget |
| 1.10 | $90,909 | +$9,091 | Under budget |
Calculated as budget ÷ CPI, per the PMI formula for estimate at completion when current efficiency continues.
The forecast assumes today's efficiency holds. Early in a job, one bad week can distort CPI, so watch the trend and not a single reading.
Acting on the Numbers
🏢
Check Overhead
Variance here is job cost only. Shared costs sit in overhead, which you can set with the overhead calculator.
Review jobs on a fixed schedule, and compare each category's CPI month to month. A falling CPI is an earlier warning than a negative total.
Sources and Method
- PMI, Earned Value Management: An Early Warning System (CV = BCWP − ACWP, CPI = BCWP ÷ ACWP, TCPI, and IEAC = BAC ÷ CPI): pmi.org
- PMI, Advances in Earned Schedule and Earned Value Management (CV = EV − AC, CPI = EV ÷ AC, ETC, EAC, and VAC = BAC − EAC; two forecast assumptions): pmi.org
- PMI, Applications and Extensions of Earned Value Analysis to Forecast Outcomes (EAC = AC + (BAC − EV) ÷ CPI = BAC ÷ CPI): pmi.org
- CMiC, Job Costing: Calculation of Percent Complete and Projected Final (percent complete from costs assumes work is completed at the rate costs accumulate): docs.cmicglobal.com
- Asana, Cost variance formula (CV = EV − AC, worked example): asana.com
- Field PM, How to Read a Construction Job Cost Report (cost to complete, projected final, and gain or fade; an unrated source): field-pm.com
- Opteam, Construction Cost Variance Calculator (competing tool, budgeted minus actual convention): opteam.ai
Earned value = revised budget × percent complete for each category. Job totals are sums of the categories, so the job forecast is the sum of category forecasts. The alert level and the choice of forecast method are your inputs, not standards.
Last reviewed: November 2026. Reviewed by site author.
⚠️ Disclaimer
This calculator provides estimates for planning purposes. For permitted structural work, foundations, multi-story construction, retaining walls over 4 feet, and commercial projects, calculations must be verified by a licensed structural engineer per IBC 2024 §1604. ConcreteCalculate.com is not liable for structural decisions made from these estimates.
This tool is not accounting, tax, or legal advice. Forecasts depend on the percent complete and cost data you enter. Confirm figures with your accountant or project controls staff before relying on them for billing, financing, or contract decisions.
Calculations run entirely in your browser. No project data is stored or transmitted to any server beyond the calculation request itself.
