Computed allocation

A computed allocation uses a compute statement, an arithmetic calculation, to determine allocation percentages. Compute statements can use data in Project Accounting or General Ledger as the basis for calculating the driver. Use computed allocations when:

  • you want to allocate amounts or units from one or more pools

  • you want to create an equation using activity or General Ledger data to determine the percentage to allocate to each post-to activity

Example

LGE Corporation wants to allocate fringe benefit costs they collect in General Ledger to activities in the Drug XYZ research project. They post labor costs to various activities in the project, and they collect labor costs by department in General Ledger. LGE wants to allocate a portion of the fringe benefit costs to each activity based on the percentage of activity labor over total department labor.

To determine the percentage, they use a compute statement that divides each activity's current period amount for labor costs by the General Ledger department's current period amount for labor costs. This percentage is then used to allocate fringe benefits from the pool to each activity.

Illustration: Using a computed allocation