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During this Microsoft Project 2016 training tutorial video, we will discuss the process of setting cost for each of your tasks; how you accrue a particular cost whether at start, end, or prorated; and which calendar is used by a resource.

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Hello again and welcome back to our course on Project 2016.
In this section we’re going to start to look at Costs. And I’m going to begin by looking at the bathroom refit project. We’re going to look at some basic aspects of costs in this project. Then I’m going to set you Exercise 05 to do, put in a little bit more detail about cost in relation to the bathroom refit. And then in the section after that we’re going to look at a couple of other more general aspects of cost and we’re going to also look at the cost for the wedding.

So first of all let’s look at the cost for the bathroom refit. And what I’m preparing here is version 05A of the bathroom refit project. And I’m going to go to the Resource Sheet and we’re going to look first of all at the cost related to the electrician. Now for work resources, generally, basically we would need at least a standard rate for a cost. And by default cost rate is entered in currency units per hour. You can express it, for instance, in cost per day but we’ll stick with per hour. And I’m going to put the electrician cost as $25 per hour as a standard rate. That’s the STD column. And I’m going to put it as $40 per hour for the overtime rate.

Now as soon as I do that if I go back to the project itself, so let me just switch back to the Gantt Chart. There’s not really any noticeable different on that at all. But if I go to Project Information on the Project Tab and click on the Statistics button I’ll now see that I’ve got for the first time a cost for the bathroom refit. And it comes out, currently, at $800. Now the reason it’s $800 is of course because the electrician is scheduled to do 32 hours of work on the project. So the first fix electric is two days work. That’s 16 hours at $25. That’s $400. And then the second fix electric is the same amount, another $400. So let’s close that and let me return to the Resource Sheet.

Now let’s take a look at a couple of other aspects of the cost of a work resource. We also specified here an overtime rate. And if for example I needed to get the electrician to work overtime, so to work outside the electrician’s normal hours of work then that is the rate I would need to pay the electrician at. This difference between standard rate and overtime rate can of course be very significant because it may increase the cost of, for example, keeping a project on time that is starting to slip. And sometimes you have to balance the cost of a delay against the additional cost of keeping on schedule.

Cost per use relates to an additional cost for each time you might need to use a resource. This may apply to a work resource. So you may, for instance, have an agency hiring fee to pay or something like that. But it also could relate, for example, to a piece of equipment, the delivery cost of a pump or a special piece of machinery.

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