Set Up Periodic Adjustments to Overhead Calculations

Assign a periodic adjustment factor to an overhead method to periodically adjust the overhead calculation. Periodic adjustment factors enable you to adjust overhead calculations for inflation, in accordance with indices such as COPAS and CPI, and other various reasons.

In a periodic adjustment factor, you can add adjustment factors that consist of an adjustment value and a start date. The adjustment value is the percentage by which you want to adjust the percentage or rate in the overhead method. It can be a positive or negative value. The start date represents the date in which you want to apply the percentage or rate adjustment to the overhead method. For example, if you need to adjust the rate in an overhead method for 6 consecutive months, you can add 6 adjustment factors to adjust the rate for each month.

You can assign a periodic adjustment factor to overhead methods that use a percentage of cost, a single rate, or a sliding scale of percentages or rates for the overhead calculation. You can assign a single periodic adjustment factor to one or more overhead methods. You can change the assignment if no adjustments have been made to the overhead method using the periodic adjustment factor.

To apply periodic adjustments to your overhead calculations, perform these tasks:

• Create a periodic adjustment factor with one or more adjustments.
• Assign the periodic adjustment factor to one or more overhead methods.
• Run the process to update overhead methods based on the associated periodic adjustment factor.
• Run the process to calculate overhead using the adjusted overhead methods.