Rate Sheet Specifies Max Charges for Quantity Tool Models:
Max Per Item Charge: Not applicable for Quantity Tools.
Max Per Job Charge: Requires additional calculations for Quantity Tools. These calculations account for quantities that are added, subtracted, and those that remain on the job.
Calculation Methods: The calculations vary based on the method used (Assignment vs. Calendar).
In both calculation methods, a maximum allowable charge is determined and applied to limit charges once this maximum has been reached.
Assignment Calculation Method
The billing engine determines the maximum quantity of items for a given model assigned to a project at any single point in time. This maximum quantity is then multiplied by the maximum charge value specified on the rate sheet to determine the maximum allowable charge. The total charge to a cost center cannot exceed this calculated maximum allowable charge.
Examples:
Initial Assignment & Addition: 100 hammers are sent to Cost Center 1, and charges are processed. Subsequently, an additional 50 hammers are sent to the same Cost Center. The quantity of 150 will be used to calculate the maximum allowable charge, as this represents the highest quantity assigned to the job.
Returns & Further Addition: If, after the initial 100 hammers, 30 hammers are returned, the maximum allowable charge is still calculated based on the previous high of 150, as this was the most ever assigned to the job. Later, if 100 more hammers are sent to Cost Center 1, a quantity of 220 (100 + 50 - 30 + 100) will now be used for the calculation. This new quantity of 220 is higher than the previous 150, but lower than the total of 250 hammers ever sent to this location.
Calendar Calculation Method: "Average on Rent" Strategy
This method, also known as "Average on Rent," is a more complex calculation because it's impossible to identify the exact rental hours for a specific quantity tool. Therefore, averages are used.
How it works:
The system calculates the average quantity of items (of the same model) that have been on the same job (cost center) since at least one of these items was assigned to that job. In simpler terms, it determines the average quantity rented since items of this model were first assigned to the job.
Key Points:
The total accumulated charges for an item on a specific job (cost center) cannot exceed the calculated maximum allowable charge.
Line items will be charged based on actual Quantity * Hours * Rate until the accumulated charges surpass the maximum allowed.
Example:
If 100 hammers are sent to Cost Center 1 and billing begins. One month later, 50 more hammers are sent to the same Cost Center. At the end of the second month, the quantity of 125 (the average of 100 and 150) will be used to calculate the maximum allowable charge.
Determining the Maximum Allowed Charge for the Calendar Method:
The maximum allowed charge is calculated as follows:
Important Note:
Because items from all transfers of a particular model are combined for these calculations, once the maximum charge has been reached, the charge amount will be assigned to the original transfer. This is provided that the "reduced" charge does not exceed the Quantity * Hours * Rate for that specific line. Subsequent line items will show a $0 charge.