Cost breakdown structure
A Cost Breakdown Structure (CBS) is a breakdown or hierarchical representation of the various costs in a project. The Cost Breakdown Structure represents the costs of the components in the Work Breakdown Structure (WBS). The CBS is a critical tool in managing and the financial aspects of any project and creates a structure for applying measurable cost controls.
The CBS allows you to define the exact level of details required to efficiently and effectively manage a given project or contract. In order to provide one cohesive construct with the necessary level of granularity, the CBS manages and tracks:
- Change orders
- Revisions and transfers
- Contingencies
- Estimate at completion
- Variances
- Progress and productivity indicators
Cost Breakdown Structure – Example
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