What is Actual Cost (AC)?
Actual Cost is the simplest of the three EVM numbers: the total money actually spent to accomplish the work completed so far. No formula, no estimation — it comes from your accounting records.
AC only becomes meaningful next to earned value. If AC is higher than EV, the work is costing more than it's worth; if lower, you're delivering value at a discount.
Worked example
The team completed 35% of a $100,000 project (EV = $35,000) but the invoices, salaries, and materials to get there totaled $42,000. That $42,000 is your AC — and the $7,000 gap is a cost overrun.