How to allocate cost resources in Microsoft Project software

How to allocate cost resources in Microsoft Project software

Allocating cost resources to an activity in Microsoft Project software and updating them requires high accuracy and skill. If you assign a Work resource and a Cost resource to an activity, only the cost of Work resources will be updated if the project is updated. For better understanding, the topic is explained with an example.

Suppose you create an activity called design for one day and assign an engineer as a Work resource and a computer device as a Cost resource to this activity. The source rate of Work is $50 per hour

By double-clicking on the activity, the Task Information window appears

In the Resource tab, enter the resources as shown below and click the Ok button. Enter the cost and actual cost columns on the page.

Enter the progress of the project at 50%. By entering the progress rate, the planned cost for the design activity shows $600 and the actual cost shows $200. As you can see, the source of cost was not effective in estimating the cost and the calculations were done only based on the source of work.

Similarly, if you record the progress rate as 100%, the actual cost will show the number of 400 dollars. So where is the cost of $200 computer calculated?

As seen, the cost of the resource is not dependent on the progress of the activity and is not included in the calculations. So how will these types of costs be applied in calculations?

Various methods have been proposed to solve this problem.

The first method: allocating resources to the summary task

In normal mode, it is not allowed to allocate resources to Summary Task. But there is an exception for Cost resources. If you do this method in the above exercise, for a detailed check, include zero progress percentage and remove the computer resource from the design activity. Assign the computer resource to the activity summary level, which in this example is the project itself. To do this, double-click on the activity and in the Task Information window and the Resources tab, allocate the resource cost of 200 dollars (computer).

Note: This is done for the Summary Task.

The result will be as follows:

Record the progress of the project at 50% and compare the result with the previous state.

Updating the project by 50% shows a $300 figure in the calculated cost. $200 of the $400 is related to the work resource and $100 of the $200 is related to the gender resource. In the same way, cost will show the number of 600 dollars to update the project by 100%. The type of calculation for both sources is in “prorated” mode.

Second method:

 Entering the cost manually through the Assignment Information box.

If you continue the above project, remove the computer resource from allocation. Enter the cost of $200 from the Task Usage window and the Tracking tab.

Update the project to 50% and 100% respectively and check the results.

The third method: 

enter the actual cost in Task Usage

Set the progress percentage to zero and remove the $200 cost assigned to the activity in the Tracking tab.

Click on the Task Usage tab and the right part of the table and check the Actual Cost option. Enter the cost of 200 dollars for the computer resource in the appropriate place.

In the Gantt chart view, you will see the cost of $200 for the computer in the Actual Cost field. By updating the project by 50%, the actual cost of the entire project changes to $400, and by progressing by 100%, it changes to $600. The result will be as follows:

Post a comment

Your email address will not be published.

fifteen + 15 =