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Item Pricing Options: Examples
You can set different pricing options for a billing schedule line item on the Advanced Pricing Options page. The following examples demonstrate how different pricing options work with the different settings.
Free Quantity Options
Support agreement - 10 support cases for free each year
The invoices for a support agreement are created monthly. The support agreement provides up to 10 free support cases every year. The contract is set up to be billed monthly with the free quantity to reset every 12 months. The Advanced Pricing Options page is set as follows:
- Free quantity = 10
- Reset number of periods = 12
- For each monthly billing invoice, the Reset free used is updated
After invoices have been created for 12 periods, the Reset free used is reset to zero (0), so that the next 12 invoice periods have 10 free support cases available.
Note: If the customer uses the 10 free support cases before invoices have been created for 12 billing periods, any support case that is over and beyond the free quantity, and is charged the company rate for a support case.
Support agreement - 10 calls for free each quarter
The invoices for a support agreement are created monthly from April 16 for 12 months. A customer is allowed 10 calls for free every quarter. The Advanced Pricing Options page is set as follows:
- Free quantity = 10
- Reset number of periods = 3
- For each monthly billing invoice, the Reset free used is updated
The following table demonstrates the billing detail for a metered item consumption:
| Billing Start Date | Billing End Date | Qty Entered | Billable Qty |
| April 16 | May 15 | 7 | 0 |
| May 16 | June 15 | 15 | 12 |
| June 16 | July 15 | 9 | 9 |
| July 16 | August 15 | 8 | 0 |
| August 16 | September 15 | 14 | 12 |
| September 16 | October 15 | 6 | 6 |
First quarter, the first 10 calls are free:
- First month quantity is 7 calls: Free Contract Used = 7, Billable quantity = 0, Remaining free = 3
- Second month quantity is 15: Free Contract Used = 10 (7 + 3), Billable quantity = 15 - 3= 12, Remaining free = 0
- Third month quantity is 9: No more free calls available, Billable quantity = 9
Second quarter, the free calls are reset back to 10 calls free:
- First month quantity is 8 calls: Free Contract Used = 8, Billable quantity = 0, Remaining free = 2
- Second month quantity is 14: Free Contract Used = 10 (8 + 2), Billable quantity = 14 - 2= 12, Remaining free = 0
- Third month quantity is 6: No more free calls available, Billable quantity = 6
Min/Max Options
Support agreement - billed a maximum of 25 support calls every quarter
The invoices for a support agreement are created monthly from April 16 for 12 months. A customer is billed for support calls every month with a maximum billable quantity of 25 calls every quarter. The Advanced Pricing Options page is set as follows:
- Type = By Quantity
- Maximum bill quantity = 25
- Reset number of periods = 3
The following table demonstrates the billing detail for a metered item consumption:
| Billing Start Date | Billing End Date | Qty Entered | Billable Qty | Comments |
| April 16 | May 15 | 10 | 10 | 10 calls billed, remaining calls to reach maximum = 15 |
| May 16 | June 15 | 12 | 12 | 12 calls billed, remaining calls to reach maximum = 3 |
| June 16 | July 15 | 9 | 3 | 3 calls billed + 6 calls not billed, maximum billable quantity has been reached (10 + 12 + 3), no additional calls are billed |
| July 16 | August 15 | 15 | 15 | 15 calls billed, remaining calls to reach maximum = 10 |
| August 16 | September 15 | 15 | 10 | 10 calls billed + 5 calls not billed, maximum billable quantity has been reached (15 + 10), remaining calls to reach maximum = 0 |
| September 16 | October 15 | 6 | 0 | Maximum billable quantity has been reached (15 + 10), no additional calls are billed |
| October 16 | November 15 | 10 | 10 | 10 calls billed, remaining calls to reach maximum = 15 |
| November 16 | December 15 | 5 | 5 | 5 calls billed, remaining calls to reach maximum = 10 |
| December 16 | January 15 | 5 | 5 | 5 calls billed, remaining calls to reach maximum = 5, below quarterly maximum |
Support agreement - billed a minimum of 25 support calls every quarter
The invoices for a support agreement are created monthly from April 16 for 12 months. A customer is billed for support calls every month with a minimum billable quantity of 25 calls every quarter. The Advanced Pricing Optionspage is set as follows:
- Type = By Quantity
- Minimum bill quantity = 25
- Reset number of periods = 3
The following table demonstrates the billing detail for a metered item consumption:
| Billing Start Date | Billing End Date | Qty Entered | Billable Qty | Comments |
| April 16 | May 15 | 7 | 7 | 7 calls billed, number of calls to reach minimum charge = 18 |
| May 16 | June 15 | 3 | 3 | 3 calls billed, number of calls to reach minimum charge (7 + 3) = 15 |
| June 16 | July 15 | 9 | 15 | 9 calls billed, number of minimum calls to be billed is 25 (remaining 6 unused calls must be billed) |
| July 16 | August 15 | 8 | 8 | 8 calls billed, number of calls to reach minimum charge = 17 |
| August 16 | September 15 | 7 | 7 | 7 calls billed, number of calls to reach minimum charge = 10 |
| September 16 | October 15 | 6 | 10 | 6 calls billed, number of minimum calls to be billed is 25 (remaining 4 unused calls must be billed) |
| October 16 | November 15 | 10 | 10 | 10 calls billed, number of calls to reach minimum charge = 15 |
| November 16 | December 15 | 12 | 12 | 12 calls billed, number of calls to reach minimum charge = 3 |
| December 16 | January 15 | 15 | 15 | 15 calls billed, above quarterly minimum |
Holds
When a schedule is put on hold, the minimum and maximum amounts or free quantity features are not affected and work as expected.
Support agreement - 15 calls for free every quarter
The invoices for a support agreement are created monthly from January to December for 12 months. A customer is allowed 15 calls for free every quarter. A hold is placed on the customer from January 01, 2017 to January 28, 2017. The Advanced Pricing Options page is set as follows:
- Free quantity = 15
- Reset number of periods = 3
- For each monthly billing invoice, the Reset free used is updated
The following table demonstrates the billing detail for a metered item consumption:
| Type | Billing Start Date | Billing End Date | Qty Entered | Billable Qty | Free Quantity | Remaining Free Quantity |
| Billable | January 01, 2017 | January 31, 2017 | 8 | 0 | 8 | 7 |
| Hold (1-Jan-2017 - 28-Jan-2017) | January 01, 2017 | 28-Jan, 2017 | 8 | 8 | -7 | 14 |
| Resume (29-Jan-2017 - 31-Jan-2017) | January 29, 2017 | January 31, 2017 | 8 | 8 | 1 | 13 |
| Billable | February 01 , 2017 | February 28, 2017 | 8 | 0 | 8 | 5 |
| Billable | March 01, 2017 | March 31, 2017 | 8 | 3 | 5 | 0 |
| Billable | April 01, 2017 | April 30, 2017 | 8 | 0 | 8 | 7 |
| Billable | May 01, 2017 | May 31, 2017 | 8 | 1 | 7 | 0 |
| Billable | June 01, 2017 | June 30, 2017 | 8 | 8 | 0 | 0 |
Support agreement - 10 calls for free every quarter
The invoices for a support agreement are created monthly from January to December for 12 months. A customer is allowed 15 calls for free every quarter. A hold is placed on the customer from February 01, 2017 to February 28, 2017. The Advanced Pricing Options page is set as follows:
- Free quantity = 10
- Reset number of periods = 3
- For each monthly billing invoice, the Reset free used is updated
The following table demonstrates the billing detail for a metered item consumption:
| Type | Billing Start Date | Billing End Date | Qty Entered | Billable Qty | Free Quantity | Remaining Free Quantity |
| Billable | January 01, 2017 | January 31, 2017 | 8 | 0 | 8 | 2 |
| Billable | February 01 , 2017 | February 28, 2017 | 8 | 6 | 2 | 0 |
| Hold (1-Feb-2017 - 28-Feb-2017) | February 01 , 2017 | February 28, 2017 | 8 | 8 | -2 | 2 |
| Resume (01-Mar-2017) | March 01, 2017 | March 31, 2017 | 8 | 8 | 2 | 0 |
| Billable | April 01, 2017 | April 30, 2017 | 8 | 0 | 8 | 2 |
| Billable | May 01, 2017 | May 31, 2017 | 8 | 6 | 2 | 0 |
| Billable | June 01, 2017 | June 30, 2017 | 8 | 8 | 0 | 0 |
Support agreement - billed a minimum of 100 minutes every three months
The invoices for a support agreement are created monthly. A customer is billed for a minimum of 100 minutes every three months. In the first month, the customer uses 20 minutes. In the second month, a hold is put on the contract. The Advanced Pricing Options page is set as follows:
- Type = By Quantity
- Minimum bill quantity = 100
- Reset number of periods = 3
The following table demonstrates the possible scenarios:
| Scenario 1 | |||
| Month | Qty Used | Qty Invoiced | Comments |
| January | 20 | 20 | |
| February | Hold | 0 | |
| March | 60 | 80 | 100 minutes - 20 used in January - 0 used in February |
| Scenario 2 | |||
| Month | Qty Used | Qty Invoiced | Comments |
| January | 20 | 20 | |
| February | Hold | 0 | |
| March | Hold | 0 | Minimum is reset |
| April | Hold | 0 | |
| May | 40 | 40 | |
| June | 30 | 60 | 100 minutes (April - June) - 0 used in April - 40 used in May |
Other Functions
Price escalations and prorate functionality are not affected by the different pricing options.
When a billing schedule is put on hold, the commit quantity or free quantity remain the same.
The invoices for a support agreement are created monthly. The customer must pay for a minimum of 100 minutes every 3 months. The Advanced Pricing Options page is set as follows:
- Type = By Quantity
- Minimum bill quantity = 100
- Reset number of periods = 3
In the first month, the customer uses 20 minutes. In the second month the contract is put on home. The following scenarios could occur:
Scenario 1
| Month | Qty Used | Qty Invoiced | Comments |
| January | 20 | 20 | |
| February | Hold | 0 | |
| March | 60 | 80 |
100 minutes is charged on the invoice:
|
Scenario 2
| Month | Qty Used | Qty Invoiced | Comments |
| January | 20 | 20 | |
| February | Hold | 0 | |
| March | Hold | 0 | The minimum minutes are reset. |
| April | Hold | 0 | |
| May | 40 | 40 | |
| June | 30 | 60 |
100 minutes is charged on the invoice:
|
