Detritus
Sel-requested Deactivation
- Joined
- Sep 25, 2016
- Posts
- 1,084
- Avatar Name
- Detritus the Troll
Business finance is not really my thing, so I'm asking for guidance here with some calculations. I'm trying to get a better understanding of how to determine costs of both goods produced and how to valuate returned mats and "bonus" items.
To simplify things, let's make up a bp: Noob Knife BP
Requires: 10x Ingots
Produces: Noob Knife
Ingot value is 0.10 each, and let's say I've purchased some stock of them at 0.11 ea.
Let's say I do 5 clicks, and have additional input of 1 ped of residue with a cost of 1.02.
Input:
50x Ingots; cost 5.5
Residue; cost 1.02
Output:
3x Noob Knife: 3.0
5x Ingots: 0.5
1x Noob Sword BP: 0.01
Residue: 0.5
So now I need to add these items into my inventory, but I'm trying to determine what their "cost" is. I can see a few different ways of determining this, and I'm not sure what makes the most sense or falls in with best practices.
1. Roll all input costs into the products, and valuate all other output at 0 cost. This would give the 3 knives their highest cost @2.173 ea; but I am returning the recovered mats, residue and bonus items to inventory at a cost of 0, so using them in the future will be cheaper or selling them will be more profitable.
2. Roll all input costs into the products, and valuate all other output at TT value, which I then need to subtract from the input costs to prevent imbalance. This would produce the cheapest knives @1.837 ea, and the net effect on other items would be as though I purchased them at 100%. The biggest problem with this method is when the output exceeds the input, such as with a global. Due to the subtraction in the cost function, this could end up with negative costs for the products, which doesn't make any sense and really screws up financial calculations.
3. What I'm leaning towards is take #1 but return the reclaimed mats back to inventory at their original cost (treat them as unused items), which also need to be subtracted from the input costs. This would produce slightly cheaper knives @2.007, my original mats remain unchanged in terms of costs, and any additional output items are treated as a zero-cost bonus. I believe this will work because to my knowledge mats are only returned on partial successes (e.g. you can't global them), so you will never get back more mats than you started with, thus the input cost will never become negative.
This is my naive thought process, is there a better way to do this?
To simplify things, let's make up a bp: Noob Knife BP
Requires: 10x Ingots
Produces: Noob Knife
Ingot value is 0.10 each, and let's say I've purchased some stock of them at 0.11 ea.
Let's say I do 5 clicks, and have additional input of 1 ped of residue with a cost of 1.02.
Input:
50x Ingots; cost 5.5
Residue; cost 1.02
Output:
3x Noob Knife: 3.0
5x Ingots: 0.5
1x Noob Sword BP: 0.01
Residue: 0.5
So now I need to add these items into my inventory, but I'm trying to determine what their "cost" is. I can see a few different ways of determining this, and I'm not sure what makes the most sense or falls in with best practices.
1. Roll all input costs into the products, and valuate all other output at 0 cost. This would give the 3 knives their highest cost @2.173 ea; but I am returning the recovered mats, residue and bonus items to inventory at a cost of 0, so using them in the future will be cheaper or selling them will be more profitable.
2. Roll all input costs into the products, and valuate all other output at TT value, which I then need to subtract from the input costs to prevent imbalance. This would produce the cheapest knives @1.837 ea, and the net effect on other items would be as though I purchased them at 100%. The biggest problem with this method is when the output exceeds the input, such as with a global. Due to the subtraction in the cost function, this could end up with negative costs for the products, which doesn't make any sense and really screws up financial calculations.
3. What I'm leaning towards is take #1 but return the reclaimed mats back to inventory at their original cost (treat them as unused items), which also need to be subtracted from the input costs. This would produce slightly cheaper knives @2.007, my original mats remain unchanged in terms of costs, and any additional output items are treated as a zero-cost bonus. I believe this will work because to my knowledge mats are only returned on partial successes (e.g. you can't global them), so you will never get back more mats than you started with, thus the input cost will never become negative.
This is my naive thought process, is there a better way to do this?