Which statement best describes the risk associated with the cost-to-cost measurement method?

Which statement best describes the risk associated with the cost-to-cost measurement method?

• A. Railroad track example-style non-uniformities are the only risk
• B. Production amount varies
• C. Non-uniformity of method
• D. Estimates are the risk

Answer: (C)

In this method, progress is shown by comparing costs incurred to date with the total estimated cost. The key risk is non-uniformity in how the measurement method is applied over time. If costs are categorized differently, recognized at different times, or the total estimated cost is updated inconsistently, the calculated percent complete can drift. That makes progress reporting unreliable, because changes in the method—not actual physical progress—drive the numbers. The other ideas miss this central point. Production pace can affect how quickly costs accumulate, but it’s the inconsistent application of the measurement approach that creates biased progress. While estimates matter, the core threat is not just having estimates but applying the method unevenly, which can distort earned value and revenue recognition.

In this method, progress is shown by comparing costs incurred to date with the total estimated cost. The key risk is non-uniformity in how the measurement method is applied over time. If costs are categorized differently, recognized at different times, or the total estimated cost is updated inconsistently, the calculated percent complete can drift. That makes progress reporting unreliable, because changes in the method—not actual physical progress—drive the numbers.

The other ideas miss this central point. Production pace can affect how quickly costs accumulate, but it’s the inconsistent application of the measurement approach that creates biased progress. While estimates matter, the core threat is not just having estimates but applying the method unevenly, which can distort earned value and revenue recognition.