Estimating Project Costs

In Microsoft Project, you assign activity costs indirectly. Costs are assigned to resources. Following are examples of resources:

• Employees at their hourly rate or prorated salaried rate, optionally including employee benefits

• Contractors

• Temporary employees

• Equipment at a lease rate or calculated periodic cost

• Facilities

Begin by creating a resource pool that includes the project resources. Resources from the pool are assigned to tasks, and the cost of a task is the cost of the resource multiplied by the amount of the resource used to complete the task.

Tip 

If your colleagues use Project, you can use resources from a pool in another Microsoft Project file. This is more than a convenience—if the projects share staff, using a common resource pool helps ensure that staff members aren’t accidentally overworked.

You’ll learn about defining and using resources in Chapter 9, and more about shared resource pools in Chapter 14. After tasks, resources and costs, and resource assignments are entered, you can quickly and easily create the project budget.