What is weighted average in SAP IS-U-BI - Contract Billing?

SAP Term: weighted average

• Component: IS-U-BI

• Component Name: Contract Billing

• Description: Average of values from a period in which values are to be weighted proportionately. The products of physical values temperature, calorfic value, or air pressure, for example or consumption are added together and divided by the sum of energy feeding quantities. W = Sum WI * QI / Sum QI I from Index qty, e.g. I={1,...,12} W: value to be weighted; Q: feeding quantity

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• Key Concepts: 
  Weighted average is a method used in SAP IS-U-BI Contract Billing to calculate the average of a set of values, where each value has a different weight. The weight assigned to each value is proportional to its importance or relevance. This method is used to calculate the average cost of a contract or the average price of a product. 
  
  How to use it: 
  In SAP IS-U-BI Contract Billing, weighted average can be used to calculate the average cost of a contract or the average price of a product. To do this, you need to enter the values and their corresponding weights into the system. The system will then calculate the weighted average based on these values and weights. 
  
  Tips & Tricks: 
  When using weighted average in SAP IS-U-BI Contract Billing, it is important to ensure that the weights assigned to each value are accurate and proportional to its importance or relevance. This will ensure that the weighted average calculated is accurate and reflects the true cost or price of the contract or product. 
  
  Related Information: 
  Weighted average is also used in other areas such as finance and accounting. It can be used to calculate the weighted average cost of capital, which is used to determine the rate of return on investments. It can also be used to calculate the weighted average cost of debt, which is used to determine the cost of borrowing money.