Cost Aggregation
The process of rolling up detailed work package cost estimates to a chosen WBS level or to a specific cost control account by adding them together.
Key Points
- Combines work package cost estimates to form higher-level budgets.
- Performed at a selected WBS level or for designated cost control accounts.
- Supports creation of the cost baseline and funding requirements.
- Relies on accurate, bottom-up estimates and consistent coding in the WBS.
Example
A project has three work packages under the "Design" control account with estimated costs of USD 20,000, USD 15,000, and USD 5,000. Using cost aggregation, the project manager sums these to report a USD 40,000 budget for the Design control account and rolls that figure up to the next WBS level for overall phase budgeting.
PMP Example Question
Which technique is used to add up work package cost estimates to establish the budget at a specific WBS level or control account?
- Parametric estimating
- Reserve analysis
- Cost aggregation
- Earned value analysis
Correct Answer: C — Cost aggregation
Explanation: Cost aggregation is the roll-up of lower-level work package cost estimates to a chosen WBS level or control account to form the budget baseline.
