Examples of Distribution Factor Calculations for Spread Curves
Distribution factors are prorated according to the spread points allocated to each period.
For example, if $100 is to be spread across four months for a planning resource that uses a prorated even spread curve (where amounts are distributed evenly), then each period is assigned $25 each. That is, 10 spread points spread over 4 months equals 2.5 spread points per period. Each spread point has a distribution factor of 10.
The following is a description of how distribution factors are calculated for full or partial periods.
Calculating Weighted Distribution Factors
To continue our previous example: Say our planning resource was using a back-loaded spread curve rather than a prorated even spread curve.
The following table describes how distribution factors are determined and amount allocated over the four planning periods.
|
Period |
Distribution Factor Calculation |
Weighted Distribution Factor |
Distribution Percentage |
Distributed Amount |
|---|---|---|---|---|
|
1 |
Distribution factors assigned to spread points 1 and 2 plus half of the distribution factor assigned to spread point 3: 0 + 5 + (0.5 * 10) |
10.0 |
4.44%, (10.0/225) |
$4.44 |
|
2 |
Half of distribution factor assigned to spread point 3 plus distribution factors assigned to spread points 4 and 5: (0.5 * 10) + 15 + 20 |
40.0 |
17.78%, (40.0/225) |
$17.78 |
|
3 |
Distribution factors assigned to spread points 6 and 7 plus half of the distribution factor assigned to spread point 8: 25 + 30 + (0.5 * 35) |
72.5 |
32.22%, (72.5/225) |
$32.22 |
|
4 |
Half of distribution factor assigned to spread point 8 plus distribution factors assigned to spread points 9 and 10: (0.5 * 35) + 40 + 45 |
102.5 |
45.56%, (102.5/225) |
$45.56 |
|
Totals |
225 |
100% |
$100 |
Deriving Spread Point Values and Prorating Distribution Factors for Partial Periods
Transaction start dates associated with a planning resource or task frequently don't coincide with the start or end dates of a period. In such a case, the actual number of planning resource or task transaction days determines how spread points and constituent distribution factors are allocated to full and partial periods.
Assume that the dates for a task assignment cover only 15 days of the first month (a 30-day month) of a four-month planning period. That first month represents the value of 0.5 spread points.
In such a case, the spread point value for each full period is calculated by dividing the total number of spread points (10) by the number of periods corresponding to the transaction (3.5). In other words, spread point values are as follows:
-
Full period : 10/3.5 = 2.8571
-
Partial Period: (10/3.5) * 0.5 = 1.4287