Understanding Rate Calculation Creation

The system displays only those fields that are valid for the selected assignment type. Consider the following validation rules for rate calculations:

• The From component must be the Cost Analyzer Balances table (F1602).

• The Based On component must be the Driver Balances table (F1632).

• The Apply To component is based on the cost driver. For example, a cost driver of Item and Hours sends output to the rate table as a rate per item.

You can use a rate calculation to calculate a per unit cost from amounts that are stored in the Cost Analyzer Balances table and volumes that are stored in the Driver Balances table. The resulting calculation is a rate value at a cost pool or driver level. For example, you can retrieve the total of sales order department costs (an amount held in the Cost Analyzer Balances table) and divide this number by the items sold (an amount held in the Driver Balances table). The resulting number is the new rate, which can be stored in the rate master tables.