Calculation Method 1 for Years Leased (Forecasted Amount for Years 1 through 6)
The system uses this setup information for this calculation:
Retrieval Bill Codes: RRTL and RPKG.
Recurring Billing Amounts: 20,000 (RRTL) and 5,000 (RPKG).
Real Estate Lease Start and End Dates: January 1, 2007 through December 31, 2012.
Term of Real Estate Lease: 72 months (6 years.)
New Rate (from assumption detail): 3.00.
The system calculates the revenue amounts for the term of the real estate lease based on the recurring billing amounts that are set up for the retrieval bill codes that you specify. The system does use the effective dates of the recurring billing information that is set up to determine which recurring billing amounts to sum. The system adds the recurring billing amounts for the term of the lease and multiplies that result by the new rate that is set up in the assumption detail using this formula: (Total Recurring Billing Amounts for Lease Term) ×(New Rate) = (Total Forecasted Amount for Years Leased)
Using the setup information, the system calculates the forecasted revenue amount for the term of the lease as follows:
20,000 + 5,000 = 25,000 (monthly rent amount from recurring billing)
25,000 × 72 = 1,800,000 (rent for lease term)
1,800,000 × 0.03 (rate) = 54,000 (forecasted amount years 1 through 6)
The system updates the total forecasted amount to the first period of the first year that the real estate lease is effective in the F15L109 table. In this example, the system updates the total forecasted amount to period 01 of 2007.