Cost estimating worksheet

A cost estimating worksheet can help to develop cost estimates when quantitative methods or a bottom- up estimate are developed. Quantitative methods include:

  • Parametric estimates
  • Analogous estimates
  • Three-point estimates

Parametric estimates are derived by determining the cost variable that will be used and the cost per unit. The number of units is multiplied by the cost per unit to derive a cost estimate.

Analogous estimates are derived by comparing current work to previous similar work. The size of the previous work and the cost are compared to the expected size of the current work. Then the ratio of the size of the current work compared to the previous work is multiplied by the previous cost to determine an estimate. Various factors, such as complexity and price increases, can be factored in to make the estimate more accurate. This type of estimate is generally used to get a high-level estimate when detailed informa- tion is not available.

A three-point estimate can be used to account for uncertainty in the cost estimate. Stakeholders pro- vide estimates for optimistic, most likely, and pessimistic scenarios. These estimates are put into an equa- tion to determine an expected cost. The needs of the project determine the appropriate equation, though a common equation is a beta distribution:


Estimated cost =  Optimistic Cost + 4 (Most Likely Cost) + Pessimistic Cost

Bottom-up estimates are detailed estimates done at the work package level. Detailed information on the work package, such as technical requirements, engineering drawings, labor duration, and other direct and indirect costs are used to determine the most accurate estimate possible.

The cost estimating worksheet can receive information from:

  • Cost management plan
  • Scope baseline
  • Project schedule
  • Quality management plan
  • Resource requirements
  • Risk register
  • Lessons learned register

Cost estimating worksheets are process 7.2 Estimate Costs in the PMBOK® Guide – Sixth Edition.

Cost estimating worksheets are developed and then refined as periodically as needed.


Document element Description
ID Unique identifier, such as the WBS ID or activity ID
Parametric estimates
Cost variable

Enter the cost estimating driver, such as hours, square feet, gallons, or some other quantifiable measure.

Example: Square feet

Cost per unit

Record the cost per unit.

Example: $9.50

Number of units

Enter the number of units.

Example: 36

Cost estimate

Multiply the number of units times the cost per unit to calculate the estimate.

Example: $9.50 x 36 = $342

Analogous estimates
Previous activity

Enter a description of the previous activity.

Example: Build a 160 square foot deck.

Previous cost

Document the cost of the previous activity.

Example: $5,000

Current activity

Describe how the current activity is different.

Example: Build a 200 square foot deck.


Divide the current activity by the previous activity to get a multiplier.

Example: 200/160 = 1.25

Cost Estimate

Multiply the cost for the previous activity by the multiplier to calculate the Cost Estimate for the current activity.

Example: $5,000 x 1.25 = $6,250

Three-point estimate (beta distribution)
Optimistic cost

Determine an optimistic cost estimate. Optimistic estimates assume all costs were identified and there won’t be any cost increases in material, labor, or other cost drivers.

Example: $4,000

Most likely cost

Determine a most likely cost estimate. Most likely estimates assume that there will be some cost fluctuations but nothing out of the ordinary.

Example: $5,000

Pessimistic cost

Weight the three estimates and divide. The most common method of weighting is the beta distribution, where c = cost:

cE = (cO+ c4M + cP)/6 Example: (4,000 +4 (5,000))/6

Expected cost

Enter the expected cost based on the beta distribution.

Example: $5,250

Elements of a bottom-up cost estimating Worksheet

Document element Description 
ID Unique identifier, such as the WBS ID or activity ID
Labor hours Enter the estimated effort hours.
Labor rate Enter the hourly or daily rate.
Total labor Multiply the labor hours times the labor rate
Material Enter quotes for material, either from vendors or multiply the amount of material times the cost per unit.
Supplies Enter quotes for supplies, either from vendors or multiply the amount of supplies times the cost per unit.
Equipment  Enter quotes to rent, lease, or purchase equipment.
Travel Enter quotes for travel.
Other direct costs Enter any other direct costs and document the type of cost.
Indirect costs Enter any indirect costs, such as overhead.
Reserve Enter any contingency reserve cost for the work package.
Estimate Sum the labor, materials, supplies, equipment, travel, other direct costs, indirect costs, and any contingency reserve.