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Budgeting Essay

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How many work weeks are in the project timeline, where work will actually occur?The project timeline runs from 1 January 2017 to 31 March 2018. This implies that there are 65 weeks in total within this period. However, taking into consideration that there are three weeks for vacation, the number of weeks in the project timeline where work will actually occur is 62 weeks.

How much money does the team cost per hour?

There are 10 managers. The manager salary for an hour is $100. Therefore, the cost for managers per hour is $100 x 10 = $1,000.

There are 100 programmers and staff. Their rate per hour is $35 per hour. Therefore, the cost for programmers and staff is $35 x 100 = $3,500.

This implies that the team costs $4,500 per hour.

How much money does the team cost per week?

Every week contains forty working hours. Taking into account that the cost per hour is $4,500, the total cost per week is $4,500 x40 = $180,000.

How much money does the team cost for the duration of the IT project?

The total cost incurred for the team for a week is $180,000. The total number of weeks for the IT period is 62 weeks. Therefore, the total team cost for the duration of the IT project is $180,000 x 62 = $11,160,000.

Remembering that maintenance is amortized, that payments begin during the first month of the project, and that all other system costs are assigned to the project, what is the total systems cost through the timeline completion on 31 March 2018?

Amortization takes into account the disseminating payments over a particular time in multiple periods. These payments that are spread out are equally paid out in the various payment periods (Deegan, 2013; Riahi-Belkaoui, 2004). The system maintenance is amortized through a five-year period and the total cost is $5.0 million. This implies that for every year, the amortization cost is $1.0 million. The total timeline period is 62 weeks and this is equivalent to 1 year and 2.5 months.

Taking into consideration that 1 year = 12 months, 2.5 months will have an amortization...

Therefore, the total amortization cost for the IT project timeline will be 1.2083 million.
The other system costs include systems planning cost of $100,000, systems development cost of $1,400,000 and system fielding cost of $300,000.

Therefore, the total system cost is calculated as follows:

Cost

$ million

System maintenance

1.2083

Systems planning cost

0.1

Systems development cost

1.4

System fielding cost

0.3

Total system cost

3.0083

The total system cost is 3.0083 million. Rounded up, the total cost is $3 million.

What is the total project cost through completion on 31 March 2018?

The total system cost as obtained above is $3.0083 million. The total team cost is $11.16 million. The total project cost includes both the system cost and the team cost. Therefore, the total project cost

Cost

$ million

Team Cost

11.16

System maintenance

1.2083

Systems planning cost

0.1

Systems development cost

1.4

System fielding cost

0.3

Total project cost

14.1683

The total project cost is 14.1683 million. Rounded up, the total cost is $14 million.

After project completion on 31 March 2018, what will be the remainder cost for maintenance that will still need to be budgeted and managed?

Subsequent to the completion of the project on 31 March 2018, the total amortization cost for the IT project timeline will be 1.2083 million. The total amortization over the course of the five-year period is $5.0 million. Therefore, the remainder cost for maintenance that will still need to be budgeted and managed is

$5.0 million - $1.2083 = $3.7917

Therefore, the total remaining cost will be $397,170.

Forecasting a budget with no strategic reserve, what should the project cost per month be for the budget during the project timeline?

In delineation, strategic reserve is reserving of an item…

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