Forecasting Project Costs using Variance Analysis
One way to report on cost control and forecasting during project execution is to use the Variance Analysis method, that is, explaining the difference (or variance) between actual costs and the budgeted costs with numbers and make new estimates for completing the work. Please consult this link Earned Value Management for related literature and references.
For the purpose of making these calculations, I will use an hypothetical project example (but it could also be a task or phase).
"A company has contracted a service provider to deliver a project in 10 working days (80 hours) for the estimated cost of $10,000 and a work effort of 200 hours. The contract is Time and Material, this means that the company pays the provider for the number of hours actually required to perform the service. So, the provider has no incentive to minimize the number of hours expended on the service. The less efficient the provider is, the more money it makes!"
Summary of Time and Material Contract (representing the initial estimated baseline):
 2 weeks duration (=10 working days)
 $10,000 cost (= budget at completion)
 200 hours effort
Situation after 5 days:
 Service Provider completed only 40% of work
 Company received $6,500 invoice from provider (actual cost after 5 days)
 Time sheet = 100 hours (actual number of hours spent on project after 5 days)
Using variance analysis to calculate data and to do forecasting:
After 5 days

BAC (Baseline)

Estimated after 5 days

A
(Actual)

ETC
(Estimate to Complete)

EAC
(Estimate at Completion)

% Completed
(A / EAC)

VAC
(BACEAC)

Work (%)

100%

50%

40%

60%

100%

40 %

0

Cost ($)

10,000

5,000

6500

6500 ^{(b)}

13000

50 %

 3000

Duration (days)

10

5

5

7^{(c)}

12

41.6 %

 2

Effort (hours)

200

100

100

120 ^{(d)}

220

45.45 %

 20

a) ETC Work is 60% because only 40% was done. The percentage change between the estimated and the actual is 20 = (45)/5x100, this means that the actual work is behind 20%.
b) ETC Cost = $6,500. The %change = (5,0006,500)/5,000 x 100 = 30%, the negative sign means that the expenditures exceeded the budgeted amount at 50% of the executed time. Hence, ETC Cost = $5,000+ 30% of $5,000= $ 6,500.
c) ETC Duration = estimated + % of work to recuperate = 5 days + (20% of 10 days) = 7 days estimated to complete
d) ETC Effort = estimated + work lag to recuperate = 100 + (20% of 100) = 120 hrs
VAC (Variance At Completion) = BAC  EAC
A graphical representation of the cost at T = 5 days:
 + 7 days to complete 60% of the work
 Cost= +$ 6500
 Duration = + 120 hours
N.B. If the project is still not completed with the new baseline, there is a need to make new calculations for a new forecast.