I have 12 months of production and 12 payments. If current month production is in excess of the target, the excess can be used to validate next month target. If current month target is not enough, next 6 months production can be used to validate.
My problem is that I do not know what formulae to use if:
1) Last month production that was used to validate previous target can not be used to validation current month target
2) Current month target is using the excess from previous month and next month production. Eg: In Mth2, I'm using the excess production of 1 from Mth1 and shortfall of 2 from Mth3 to meet Mth2 target and will pay out $2
3) Max catch-up is 6 months. Eg: Mth1 target can use Production from Mth1 to Mth6, Mth2 target can use Production from Mth2 to Mth7 so on and so forth
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