# Calculating Surcharges

While there is one standard process when calculating surcharges in sales and purchase document lines (as ultimately calculated in the **Exp. Alloy Amount** field), there are different calculation methods.

## Calculating based on alloy quotations

The alloy quotation is calculated based on several factors, including various settings on Alloy Conditions that allow you to set different periods for calculations and to stagger your calculations. You can also set specific quotations per customer and vendor. In general, the alloy quotations are calculated using the following formula:

*(Alloy Quotation – Alloy Base) / 100 * Total Alloy Weight in KG*.

### Example: Alloy Quotation

Your alloy surcharge agreement with a vendor is set up that the alloy base for copper is 50.00 but you use the standard alloy quotation for calculating the surcharge. You order 100 units of this item, which has a total alloy weight of 43, in a time period when the alloy quotation is 680.00. The expected alloy surcharge will be 270.90: 680 - 50 / 100 * 43.

### Example: Specific Quotation

Your customer uses a specific alloy quotation amount of 500.00 for copper. When they order a copper item, the alloy quotation is 500.00, regardless of the market price for that time period. If there is no alloy base and the total alloy weight of the item is 43, then the expected alloy surcharge will be 215.00: 500 / 100 * 43.

### Example: Staggered Quotation

The calculation of a staggered quotation determines the date range to be used in the alloy quotation, it does not calculate the surcharge amount.

Your customer has an alloy condition for copper with the *Receipt of Order Date* as the **Reference Date** and *Quarter* as the **Calculation Formula**. When they place an order on 01/27/2022, the Period Start Date and Period End Date are calculated as 01/01/2022 to 03/31/2022.

Another customer has a similar alloy condition except they chose to use a Staggered calculation. When they place an order on 01/27/2022, the Period Start Date and Period End Date are calculated and moved one month before as 12/01/2021 to 02/28/2022.

## Calculating based on alloy quotations including reference surcharges

Reference surcharges are typically applied to alloy quotations for electronic items but can be used in other scenarios as well. A reference surcharges is basically an overhead charges added to the alloy quotation, which is then used to calculate the expected alloy amount. The formula to calculate the alloy quotation is:

*Alloy Quotation + Alloy Quotation * Reference Value / 100*

### Example

Your alloy surcharge agreement with a vendor is set up to include a reference surcharge of 1% for copper items. You order 100 units of a copper item, which has a total weight of 43 and the alloy quotation for the time period is 680.00. Due to the 1% reference surcharge, the alloy quotation is calculated as 686.80: 680.00 + 680.00 * 1% / 100.

The expected alloy surcharge is then calculated at 295.32 using the standard formula: 686.80 / 100 * 43.

## Calculating based on scale surcharges

With scale surcharges, the expected alloy amount is calculated based on a percentage of the alloy quotation amount bought or sold. The formula is:

*(Surcharge %) / 100 * Unit Price * Quantity*

### Example

Your customer is set up for the following scale surcharges when purchasing aluminum:

- 0.00 - 149.00 = 3%
- 150.00 - 169.00 = 5%
- 170 - 189 = 7%
- > 190 = 9%

If your customer places an order for 100 pieces of this item that has a unit price of 3.80, and the alloy quotation amount is 180.00 for the time period, they will be charged 26.60: 7% / 100 * 3.80 * 100.

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