Description
Decompose revenue change into quantity and price effects.
Business accounting and analytics distinguish gross, net, allocated, recognized and forecast amounts. Currency, period, eligibility and interaction-allocation conventions determine a reported contribution; reconciling one term does not verify revenue, payment rights or future commercial outcomes.
Decompose revenue change into quantity and price effects.
When to use this tool
Use Revenue Waterfall One Category Change when reconciling the stated business amount, share, bridge or forecast convention.
How to use the tool and how it works
- Enter priorQuantity, currentQuantity, priorPrice, currentPrice. Use the units and conventions below.
- Run the tool. Correct any format, range, or cross-field input error before interpreting the output.
- Read quantityEffect, priceEffect, totalChange. Use the output convention below.
Decompose revenue change into quantity and price effects. Require nonnegative quantities/prices; quantityEffect = (newQ-oldQ)*oldPrice, priceEffect = newQ*(newPrice-oldPrice), totalChange = newQ*newPrice-oldQ*oldPrice.1
| Input field | Meaning and units | Accepted input |
|---|---|---|
| priorQuantity | Prior Quantity | Required. Finite number; minimum 0. |
| currentQuantity | Current Quantity | Required. Finite number; minimum 0. |
| priorPrice | Prior Price | Required. Finite number; minimum 0. |
| currentPrice | Current Price | Required. Finite number; minimum 0. |
| Output field | Interpretation | Returned shape |
|---|---|---|
| quantityEffect | Quantity Effect | Required. Finite number. |
| priceEffect | Price Effect | Required. Finite number. |
| totalChange | Total Change | Required. Finite number. |
{
"input": {
"priorQuantity": 100,
"currentQuantity": 120,
"priorPrice": 10,
"currentPrice": 12
},
"output": {
"quantityEffect": 200,
"priceEffect": 240,
"totalChange": 440
}
}Limitations and assumptions
- This allocates the interaction to priceEffect; summing an extra cross term would double-count it, and no causal price effect is inferred.
- Inputs must satisfy both the field types and the cross-field conditions above. Invalid input causes an error; a successful false flag or documented placeholder is a different result.
- Numeric calculations use binary floating point unless exact decimal-integer arithmetic is explicitly stated. No hidden measurement tolerance or decimal rounding is added; nonfinite or out-of-contract results are rejected. Numeric signed-zero results are exported as zero.
Alternative or Complementary methods
Use complete verified accounts and governing commercial terms, and apply the appropriate accounting and financial judgment for actual reporting, payment or investment decisions.
References
Similar or alternative tools
- Contribution Margin Bridge Term
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- Margin Price Change Contribution Tool
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