1. Contract and Service Billing Implementation Guide
  2. Percent of Cost Method

Percent of Cost Method

When you specify the Percent of Cost method, the system calculates the invoice amount as:

  • Markup Amount = Schedule of Values − Projected Final Cost (inception-to-date)

  • Markup Percent of Cost = Markup Amount ÷ Projected Final Cost (inception-to-date)

  • Current Invoice Amount = Markup Percent of Cost × Actual Cost for Current Period

    Actual Cost for Current Period is calculated using the from date on the processing options of the Contract Billing Invoice Generation program (R52121).

    Projected Final Cost is calculated as inception-to-date, but if the annual close has not been completed the Account Balances table (F0902) contains only year-to-date information.

    Schedule of Values is stored in the billing line details portion of a contract. Actual Cost for Current Period is located in the AA ledger. Projected Final Cost is located in the HA ledger.