Definition

Actual Cost (AC) is a term used in project management to refer to the total amount of money that has been spent on a project up to a certain point in time. It is also known as Actual Cost of Work Performed (ACWP). This figure is calculated by adding together all the costs associated with the project, including labor, materials, and overhead.

Calculation

The actual cost of a project can be calculated by taking into account all the costs associated with it. This includes direct costs such as labor and materials, as well as indirect costs such as overhead and other expenses. The actual cost should also include any changes or adjustments made during the course of the project. Once all these costs have been added up, the total will give you the actual cost of the project.

Importance

Actual cost is an important metric for project managers to track because it allows them to monitor how much money they are spending on a project. By tracking this information, they can make sure that their projects stay within budget and that they are not overspending. Additionally, tracking actual cost can help identify areas where savings can be made or where additional resources may be needed.