MA.1:4.4 - Attach the relevant monetary meanings

Connect resource quantities to money through the relationship that actually applies. For each amount that could be misread, make clear whether it is:

• consumption valued for the account, such as materials issued from stock;
• the payment required to supply or obtain a resource, such as a whole additional shift;
• a payment at a particular time; or
• an assigned share under an allocation convention.

The distinction can be carried in ordinary columns or explanatory prose.

A supplied resource can be consumed without another payment in the period. Record the capability used and the account’s warranted value without inventing a cash saving or expenditure. Conversely, obtaining a resource block may require paying for more capacity than the proposed work consumes. Use the charging rule for that block. An average rate multiplied by consumed hours does not reproduce every supply arrangement.

Preserve the horizon. A salaried hour whose payment is unchanged this week can still matter to a later staffing decision or to displaced work now. Stock consumption can trigger a replacement payment, use scarce inventory or have another relevant consequence even though the original purchase is sunk. Obtain those facts for the receiving comparison instead of classifying a cost as permanently fixed or variable.

When a shared assignment is the unresolved issue, use MA.3. When management, reporting and cash amounts appear inconsistent, use MA.4. These are separate questions that can also be answered from adequate existing accounts.