Earn Value Management

You can watch some video about using MS Project to calculate EVM :
http://www.youtube.com/watch?v=GJGc8MAewLY
http://www.youtube.com/watch?v=jicLJ6SOYcg
http://www.tacticalprojectmanagement.com/earned-value-management-tips/how-to-calculate-eva-in-microsoft-project.html

Or
http://www.youtube.com/watch?v=7WsfuvHegxE&feature=related
http://office.microsoft.com/en-au/project-help/applying-earned-value-analysis-to-your-project-HA001021179.aspx - Applying EVm to your project

The below post-blog describe the definition of EVM :

There are following three bacis elements of EVM

• Planned Value (PV)
• Actual Cost (AC)
• Earned Value (EV)

All the three elements are captured on a regular basis as of a reporting date.

Planned Value (PV)

This is also referred to as Budgeted Cost of Work Scheduled ( BCWS ). Planned Value (PV) or BCWS is the total cost of the work scheduled /Planned as of a reporting date.
This is calculated as:

PV or BCWS = Hourly Rate * Total Hours Planned or Scheduled

NOTE: Hourly Rate is the rate at which effort will be valued.

Actual Cost (AC)

This is also referred to as Actual Cost of Work Performed (ACWP). Actual Cost (AC) or ACWP is the total cost taken to complete the work as of a reproting date.
This is calculated as:

AC or ACWP = Hourly Rate * Total Hours Spent

Earned Value (EV)

This is also referred to as Budgeted Cost of Work Performed (BCWP). Earned Value (EV) or BCWP is the total cost of the work completed/performed as of a reproting date.
This is calculated as:

EV or BCWP = Baselined Cost * % Complete Actual

All these three elements can be derived from Work Breakdown Structure by associating the costs to each of the tasks. For a big project it will be a tedious task to calculate these elements manually. Scheduling Softwares like Microsoft Project is used to calculate these three elements.

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NOTE: % Completed Planned and % Compelted Actual are defined below

% Completed Planned

The percentage of work which was planned to be completed by the Reporting Date. This is calculated using the following formula

% Completed Planned = PV / BAC

% Completed Actual

The percentage of work which was actually completed by the Reporting Date. This is calculated using the following formula

% Completed Actual = AC / EAC