Oracle Financial Reporting and Analysis Cloud 2017 Implementation Essentials — Question 46

You have a small project for a period of five months. Your budget amount for each month is spread evenly and is $1000 per month. The first month actual expense is $800 and there is a commitment for $600. Now you generate a forecast at the beginning of the second month. Identify the monthly Estimate-To-Complete (ETC) amount that the application would calculate for the remaining four periods, when the ETC generation method includes commitments. (Choose the best answer.)

Answer options

Correct answer: A

Explanation

The Estimate-To-Complete (ETC) is calculated by taking the remaining budget and dividing it by the number of remaining periods. Since the total budget is $5000 (5 months x $1000) and the first month had an actual expenditure of $800 with a commitment of $600, the remaining budget is still $1000 per month for the next four periods, hence the ETC is $1000.