CAPM (Certified Associate in Project Management) Practice Exam

What does the budget at completion (BAC) represent?

1. The total project costs including all work phases

2. The sum of all budgets established for the work to be performed

3. The estimated total cost at the project's end

4. Market conditions and currency exchange rates

The correct answer is: The sum of all budgets established for the work to be performed

The correct answer is B. The budget at completion (BAC) represents the sum of all budgets established for the work to be performed in a project. It is essentially the total budgeted cost of the project, encompassing all the work phases and activities. BAC serves as a crucial reference point for project managers to gauge the total planned cost of the project and compare it to the actual costs incurred during its execution. Option A is incorrect because the total project costs including all work phases are described by the total budgeted cost, not specifically the budget at completion (BAC). Option C is incorrect because the estimated total cost at the project's end is generally referred to as the estimated cost at completion (EAC), not the budget at completion (BAC). Option D is incorrect because market conditions and currency exchange rates are not directly related to the budget at completion (BAC), which primarily focuses on the sum of the established budgets for the project's work.