Rebates - How to estimate the price adjustments (Variable Consideration) in RMCS?
SummaryOur client has a scenario where rabate is given contingent upon certain events. How do we estimate the rebates?
Contract includes a rebate to the customer upon achieving a target amount in the contract. The requirement is to estimate the rebate and reallocate to the other lines in the contract. The rebate will be given by way of credit based on actual. We tried the following steps.
- Create a negative contract line for the rebates estimate amount.
- As SSP representation type is Gross Margin, we populated $0 for the cost amount so that the margin will be above the SSP range.