How are planned revenue and planned cost calculated?

Planned revenue and planned cost are the forward-looking versions of actuals, built from Allocations (or budgets for fixed price projects) and Planned expenses rather than tracked work. Like actuals, each combines a work stream and an expense stream, with planned revenue branching by billing type.

Written By Lauri Eurén

Last updated 1 day ago

Planned revenue and planned cost are the forward-looking versions of revenue and cost — what you expect a project to earn and to cost, built from the plan (Allocations and Planned expenses) rather than from tracked work. Like the actual figures, each combines two streams — work and expenses — and planned revenue branches by billing type.

  • Planned cost = planned work cost + planned expense cost.

    • Work cost = allocation % × cost rate × working hours, summed across the allocated dates.

    • Expense cost = the cost of each Planned expense, billable or not.

    • This is the same on every billing type.

  • Planned revenue = planned work revenue + billable Planned-expense revenue, where work revenue depends on the billing type:

    • Time-and-materials: allocation % × billing rate × working hours, summed across the dates, plus the billed amount of each billable Planned expense.

    • Capped time-and-materials: the same, capped at the Budget.

    • Fixed-price: the Budget, distributed across time by the revenue recognition method — not the Allocations. Allocations still drive planned cost (and, for the weighted method, shape how the budget spreads), but they don't set planned revenue. Billable Planned expenses recognize through the same method.

    • Non-billable: zero.

Wherever Allocations drive the figure — all planned cost, and planned revenue for time-and-materials — both confirmed and tentative Allocations count, so tentative work is part of the plan. Reports keep the two distinct, so you can read committed (confirmed) work separately from tentative, potential work rather than seeing only a combined total.

What working hours go into the formula

The hours in each day's planned figure are the Person's working hours for that day, adjusted by Operating's working-hours rules:

  • zero on weekends and outside the Person's employment dates,

  • zero on a day with confirmed full-day Time off,

  • reduced on a public holiday by the holiday's percentage (a 50% holiday gives half a day),

  • otherwise the Person's individual working hours, or the Site's hours when no individual hours are set.

So planned cost drops automatically across holidays and leave on any project, without anyone editing the Allocation — fewer working hours means less cost. Planned revenue drops the same way for time-and-materials and capped time-and-materials, where revenue follows the hours. Fixed-price revenue does not: it comes from the Budget and is recognized on its own schedule, so it doesn't move with holidays or leave.

Worked example (time-and-materials)

A Person allocated 50% for a week — 5 working days × 8 hours is 40 full-time hours, so 20 allocated hours — on a $150/hour billing rate and $90/hour cost rate, plus a $200 billable Planned expense billed to the client at $250:

  • Planned work revenue = 150 × 20 = $3,000; + billable expense $250 → planned revenue $3,250

  • Planned work cost = 90 × 20 = $1,800; + expense cost $200 → planned cost $2,000

If that expense were non-billable, planned revenue would stay $3,000 (nothing is billed) while planned cost would still be $2,000.

On a fixed-price project the planned cost is identical, but planned revenue would be the Budget recognized across the week by the project's method — not the $3,000 from the Allocation.

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