Unit Sales Revenue Page (Absorption)

A Unit Sales Revenue Page (Absorption) is a Page SubType generated by entering a Unit Sales Dialog, accessed by choosing Edit/Unit Sales... One Unit Sales Revenue Page (Absorp- tion) is generated for each Unit Type when you have chosen to use the Absorption method for planning sales for that Unit Type. You can edit any of the assumption values shown, and the Unit Sales Revenue generated in the resulting analysis will correspond to the edited values. Additionally, appropriate assumption values of the Unit Sales Revenue may also be varied in Sensitivity and Risk analyses. You may discern a Unit Sales Revenue Page (Absorption) in the Assumption Page List by its Page Abbreviation: Rev-usa.

The assumptions in a Unit Sales Revenue Page (Absorption) are:

UNIT PRICE is the price per unit for this Unit Type at the Unit Sale Start Date.

TOTAL UNITS TO BE SOLD is the total number of this unit type sold, no matter when.

UNIT SALE START DATE is the date on which the sale of this Unit Type starts.

UNIT SALE GROWTH RATE is the annual percentage growth rate of the Unit Price for these units. The Unit Price grows at this rate every month for sales planned with Absorption Pages, IGNORING any Price Inflation entered in the Unit Sales Parameter Page unless you have chosen to override this rate using the Absorption Growth Override on the Unit Sales Parameter Page.

UNITS SOLD PER MONTH is the number of Units sold per month (ie: rate of sales). This can be entered as a fractional number (eg: 2.45 units/month), and any fraction remaining is deferred to later months until it reaches a whole number. For example, 2.45 unit/month results in scheduled sales of 2, 2, 3, 2, 3, etc.

UNIT STANDARD COST is used to allocate the Costs specified as Unit Sales Costs to the appropriate time period for Income Tax purposes. Unit Sales Costs affect cash flows at the time incurred. However, for tax purposes, they are allocated to the Units Sold, and deducted at the time of the Unit Sale. To accomplish this, the Unit Standard Cost times the number of Units Sold for each Unit Sales Revenue Page (either Discrete OR Absorption) is added together to obtain the Total Standard Cost for the Project. Then each Unit Sales Cost in the Cost Grid is allocated to each Unit Sale based on the ratio of the Unit Sale Standard Cost to the Total Project Standard Cost. You may view the results of this allocation in the Taxable Expense column of the Audit Grid for each of the Unit Sales Cost Pages.

UNIT SALE COST is limited to 100 or less, and is treated as a percentage of the Unit Price.