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<ManualTopic ID="/baanerp/tp/onlinemanual/000330" xml:lang="en">
   <Header>
      <Title>To use a leading estimate type</Title>
      <Keyword type="header" order="d1e2275901">
         <Level1>top down</Level1>
      </Keyword>
      <Keyword type="header" order="d1e2275904">
         <Level1>bottom up</Level1>
      </Keyword>
   </Header>
   <GeneralSection>
      <Paragraph>As a concept in <Link href="/baanerp/tp/onlinemanual/tpest" role="manual">
            <GUIRef href="/baanerp/tp/est" role="module">Project Estimating</GUIRef>
         </Link>, <Link href="/baanerp/tp/glossary/glossary#000361" role="glossary">estimate type</Link> enable
		you to switch between top-down estimates and bottom-up estimates. In general,
		if you want to estimate a project, your work direction is top down because you
		lack detailed information on the project cost.</Paragraph>
      <Paragraph>In an estimate, you first investigate if you can create a
		feasible bid for your customer. Secondly, you calculate the approximate target
		cost price for your project. You can use this cost amount to allocate the
		estimate over the required work or departments involved.</Paragraph>
   </GeneralSection>
   <ExampleSection>
      <SectionTitle>For example</SectionTitle>
      <Paragraph>A customer requests the approximate cost of a luxurious yacht.
		Your shipyard considers the request for quotation. Based on experience, you
		know that the sales price must be approximately EUR 65 million. To build the
		yacht, you need the cooperation of the Project Management (PM) department and
		the Construction department. The PM department is required for redesigning an
		existing CAD drawing of a ship; this costs EUR 9 million. The Construction
		department requires approximately EUR 50 million to build the yacht. If the
		yacht is built, it will require decorating; a subcontractor carries out this
		job.</Paragraph>
      <Paragraph>In this example, you create the following estimate in the <GUIRef href="/baanerp/tp/est/tpest1100m000" role="session">Estimate Versions (tpest1100m000)</GUIRef> session.</Paragraph>
      <List>
         <ListIntro>The field names and the field values are as
		  follows:</ListIntro>
         <ListItem>Version - 1a Estimate Yacht</ListItem>
         <ListItem>Version amount - EUR 65 million</ListItem>
         <ListItem>Profit fee - EUR 5 million</ListItem>
         <ListItem>Management reserve - EUR 0 million</ListItem>
         <ListItem>Undistributed amount - EUR 60 million</ListItem>
         <ListItem>Distributed amount - EUR 0 million</ListItem>
      </List>
      <Paragraph>Top down, you define an amount for the TOP of EUR 60 million.
		The distributed amount becomes EUR 60 million.</Paragraph>
      <List>
         <ListIntro>You have the following activity structure available for
		  building the ship:</ListIntro>
         <ListItem>TOP = The yacht</ListItem>
         <ListItem>01 = Redesigning</ListItem>
         <ListItem>02 = Building ship</ListItem>
         <ListItem>03 = Decorating</ListItem>
      </List>
      <Paragraph>01, 02, and 03 are linked as child activities to the
		TOP.</Paragraph>
   </ExampleSection>
   <GeneralSection>
      <SectionTitle>To structure the estimate</SectionTitle>
      <Paragraph>In general, for a starting estimate, all <Link href="/baanerp/tp/glossary/glossary#000370" role="glossary">structural element</Link> have a top-down <Link href="/baanerp/tp/glossary/glossary#000362" role="glossary">leading estimate type</Link>. In the <GUIRef href="/baanerp/tp/est/tpest1120m000" role="session">Structural Elements (tpest1120m000)</GUIRef> session, you can define the estimate type as top down
		or bottom up. The leading estimate type of a structural element determines the
		way the calculation of the estimate is performed. You can change the estimate
		type in the process.</Paragraph>
      <Paragraph>1. Enter your top-down estimate in the <GUIRef href="/baanerp/tp/est/tpest2100m000" role="session">Estimate Lines (tpest2100m000)</GUIRef> session: line number activity description estimate
		type line level type amount in EUR</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="4">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">line
				5</TD>
               <TD rowspan="1" colspan="1">TOP</TD>
               <TD rowspan="1" colspan="1">Yacht</TD>
               <TD rowspan="1" colspan="1">top down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">60
				mln</TD>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">line 10</TD>
               <TD rowspan="1" colspan="1">01</TD>
               <TD rowspan="1" colspan="1">Redesigning</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">9 mln</TD>
            </TR>
            <TR no="3" isLast="false">
               <TD rowspan="1" colspan="1">line 20</TD>
               <TD rowspan="1" colspan="1">02</TD>
               <TD rowspan="1" colspan="1">Building ship</TD>
               <TD rowspan="1" colspan="1">top down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">50
				mln</TD>
            </TR>
            <TR no="4" isLast="true">
               <TD rowspan="1" colspan="1">line 25</TD>
               <TD rowspan="1" colspan="1">03</TD>
               <TD rowspan="1" colspan="1">Decorating</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">1 mln</TD>
            </TR>
         </TBODY>
      </TABLE>
      <Paragraph>Element 03, line 25, is subcontracted to another company. A
		request for quotation is sent to the subcontractor, but you estimate EUR 1 mln
		cost.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Estimate lines</SectionTitle>
      <Paragraph>You must enter more detailed <Link href="/baanerp/tp/glossary/glossary#000374" role="glossary">estimate line</Link>, and you
		must define the whole estimate structure. Some child activities, for which you
		know more exact bottom-up information, have the Bottom-Up leading estimate
		type:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="9">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">Struc. el.</TD>
               <TD rowspan="1" colspan="1">LET</TD>
               <TD rowspan="1" colspan="1">launch
				level type</TD>
               <TD rowspan="1" colspan="1">cost level type</TD>
               <TD rowspan="1" colspan="1">sales level type</TD>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">TOP = The yacht</TD>
               <TD rowspan="1" colspan="1">top down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="3" isLast="false">
               <TD rowspan="1" colspan="1">01 = Redesigning</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="4" isLast="false">
               <TD rowspan="1" colspan="1">02 =
				Building</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="5" isLast="false">
               <TD rowspan="1" colspan="1">03 =
				Decorating</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="6" isLast="false">
               <TD rowspan="1" colspan="1">011= CAD
				rework</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="7" isLast="false">
               <TD rowspan="1" colspan="1">021=
				Steel</TD>
               <TD rowspan="1" colspan="1">bottom up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="8" isLast="false">
               <TD rowspan="1" colspan="1">022= Yard
				work</TD>
               <TD rowspan="1" colspan="1">bottom up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
            <TR no="9" isLast="true">
               <TD rowspan="1" colspan="1">023=
				Engine</TD>
               <TD rowspan="1" colspan="1">bottom up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">total</TD>
            </TR>
         </TBODY>
      </TABLE>
      <Paragraph>011 is linked to 01. 021, 022, and 023 are linked to 02. As you
		can see, the 02 Building ship parent activity remains a top-down activity
		because of expected overhead costs.</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="9">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">line
				number</TD>
               <TD rowspan="1" colspan="1">activity</TD>
               <TD rowspan="1" colspan="1">estimate type</TD>
               <TD rowspan="1" colspan="1">line level
				type</TD>
               <TD rowspan="1" colspan="1">amount in EUR</TD>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">30</TD>
               <TD rowspan="1" colspan="1">021</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">30 mln</TD>
            </TR>
            <TR no="3" isLast="false">
               <TD rowspan="1" colspan="1">35</TD>
               <TD rowspan="1" colspan="1">022</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">15 mln</TD>
            </TR>
            <TR no="4" isLast="false">
               <TD rowspan="1" colspan="1">40</TD>
               <TD rowspan="1" colspan="1">023</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">2 mln</TD>
            </TR>
            <TR no="5" isLast="false">
               <TD rowspan="1" colspan="1">45</TD>
               <TD rowspan="1" colspan="1">011</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">5 mln</TD>
            </TR>
            <TR no="6" isLast="false">
               <TD rowspan="1" colspan="1">50</TD>
               <TD rowspan="1" colspan="1">011</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">3 mln</TD>
            </TR>
            <TR no="7" isLast="false">
               <TD rowspan="1" colspan="1">55</TD>
               <TD rowspan="1" colspan="1">011</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">2 mln</TD>
            </TR>
            <TR no="8" isLast="false">
               <TD rowspan="1" colspan="1">60</TD>
               <TD rowspan="1" colspan="1">02</TD>
               <TD rowspan="1" colspan="1">top
				down</TD>
               <TD rowspan="1" colspan="1">cost type (labor)</TD>
               <TD rowspan="1" colspan="1">4
				mln</TD>
            </TR>
            <TR no="9" isLast="true">
               <TD rowspan="1" colspan="1">65</TD>
               <TD rowspan="1" colspan="1">02</TD>
               <TD rowspan="1" colspan="1">top down</TD>
               <TD rowspan="1" colspan="1">cost type
				(material)</TD>
               <TD rowspan="1" colspan="1">46 mln</TD>
            </TR>
         </TBODY>
      </TABLE>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Estimate details</SectionTitle>
      <Paragraph>Up to now, you used a top-down estimate; you just allocated
		amounts. However, your two internal departments involved in this project
		provide their own estimates for building the yacht. Based on their experience,
		they can provide a more detailed calculation. Enter these detailed lines in
		your estimate version.</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="7">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">line
				number</TD>
               <TD rowspan="1" colspan="1">activity</TD>
               <TD rowspan="1" colspan="1">estimate type</TD>
               <TD rowspan="1" colspan="1">line level
				type</TD>
               <TD rowspan="1" colspan="1">amount in EUR</TD>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">70</TD>
               <TD rowspan="1" colspan="1">011</TD>
               <TD rowspan="1" colspan="1">bottom
				up</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">5 mln</TD>
            </TR>
            <TR no="3" isLast="false">
               <TD rowspan="1" colspan="1">80</TD>
               <TD rowspan="1" colspan="1">011</TD>
               <TD rowspan="1" colspan="1">bottom
				up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">3 mln</TD>
            </TR>
            <TR no="4" isLast="false">
               <TD rowspan="1" colspan="1">85</TD>
               <TD rowspan="1" colspan="1">023</TD>
               <TD rowspan="1" colspan="1">bottom
				up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">1 mln</TD>
            </TR>
            <TR no="5" isLast="false">
               <TD rowspan="1" colspan="1">90</TD>
               <TD rowspan="1" colspan="1">022</TD>
               <TD rowspan="1" colspan="1">bottom
				up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">15 mln</TD>
            </TR>
            <TR no="6" isLast="false">
               <TD rowspan="1" colspan="1">95</TD>
               <TD rowspan="1" colspan="1">021</TD>
               <TD rowspan="1" colspan="1">bottom
				up</TD>
               <TD rowspan="1" colspan="1">total</TD>
               <TD rowspan="1" colspan="1">40 mln</TD>
            </TR>
            <TR no="7" isLast="true">
               <TD rowspan="1" colspan="1">100</TD>
               <TD rowspan="1" colspan="1">03</TD>
               <TD rowspan="1" colspan="1">bottom
				up</TD>
               <TD rowspan="1" colspan="1">detail</TD>
               <TD rowspan="1" colspan="1">0,5 mln</TD>
            </TR>
         </TBODY>
      </TABLE>
      <Paragraph>If you look at 011, a top-down total of EUR 5 million is
		expected. However, if you add up the two bottom-up detail lines of 011, that
		part of the ship adds up to EUR 3 million or 5 million. This depends on the
		level type. If you entered all necessary estimate lines, you can aggregate
		totals and see the estimate amounts for the leading estimate type. For the
		exact formulas, see the online Help in the <GUIRef href="/baanerp/tp/est/tpest2100m000" role="session">Estimate Lines (tpest2100m000)</GUIRef> session. Before you can understand the amounts that
		result from these calculations, you must know how the level type influences the
		total amounts on the estimate lines.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>To use level types</SectionTitle>
      <Paragraph>To use <Link href="/baanerp/tp/glossary/glossary#000373" role="glossary">level type</Link>
      </Paragraph>
      <Paragraph>If the <Link href="/baanerp/tp/glossary/glossary#000362" role="glossary">leading estimate type</Link> (LET)
		in the <GUIRef href="/baanerp/tp/est/tpest1120m000" role="session">Structural Elements (tpest1120m000)</GUIRef> session is Bottom Up, you can calculate
		estimate totals for Total and Detail level types. If the leading estimate type
		is Top Down for a structural element, you cannot apply level type aggregation,
		but you can use level types to check the consistency of top-down lines.</Paragraph>
      <List>
         <ListIntro>LN distinguishes the following level types for a top-down estimate
		  line:</ListIntro>
         <ListItem>Total.</ListItem>
         <ListItem>Cost Type.</ListItem>
         <ListItem>Detail.</ListItem>
         <ListItem>Other Structures.</ListItem>
      </List>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Top-down level types</SectionTitle>
      <Paragraph>Top down has a consistency check for top-down structural
		elements. Lines with different level types are used for different calculations,
		and are bound to rules. In the <Link href="/baanerp/tp/pdm/tppdm0101s000" role="session">User Profiles (tppdm0101s000)</Link> session you can define the calculation settings
		for the consistency check. In this session, you define whether the check of the <GUIRef href="/baanerp/tp/est/tpest2220m000" role="session">Verify Top-Down Estimate Consistency (tpest2220m000)</GUIRef> session is performed for each
		field, or for each record. By using the Level field types entered in the <GUIRef href="/baanerp/tp/est/tpest2100m000" role="session">Estimate Lines (tpest2100m000)</GUIRef> session, the check is performed in the following
		order:</Paragraph>
      <ProcedureList>
         <ListItem>Total: For the Total level type, the consistency check is
		  performed to find out whether the total amount of the structural element does
		  not exceed the parent’s structural element amount. Example, line 10 + line 20 +
		  line 25 must be less than or equal to line 5. In top-down estimating, you must
		  always use a Total line.</ListItem>
         <ListItem>Cost type: For the Cost Type level type, the consistency check
		  is performed to find out whether the amount does not exceed the Total amount of
		  the same structural element. Example, line 60 + line 65 must be less than or
		  equal to line 20.</ListItem>
         <ListItem>Detail: For the Detail option, the consistency check is
		  performed to find out whether line amounts of the same cost type do not exceed
		  the Cost Type amount with the Total level type. For example, line 50 + line 55
		  must be less than or equal to line 45.</ListItem>
         <ListItem>Other Structures: For the Other Structures level type, the
		  consistency check is performed to find out whether the line amount does not
		  exceed the amount of the structural element with the Total level type.</ListItem>
      </ProcedureList>
      <Note>
         <SectionTitle>Note</SectionTitle>
         <Paragraph>The Cost Type - Detail lines amount check is only performed
		  if you run the <GUIRef href="/baanerp/tp/est/tpest2220m000" role="session">Verify Top-Down Estimate Consistency (tpest2220m000)</GUIRef> session.</Paragraph>
      </Note>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Bottom-up level types</SectionTitle>
      <Paragraph>A bottom-up line can only have two different level types: Total
		and Detail. Because you just enter the costs and add them up, there is no
		consistency check. In the <GUIRef href="/baanerp/tp/est/tpest1120m000" role="session">Structural Elements (tpest1120m000)</GUIRef> session, you can determine which level type is used in
		the bottom-up estimate. The values of the Cost Level and Sales Level fields
		determine the lines that are aggregated for cost or sales. The Launch field’s
		level type determines which estimate lines linked to the defined level type are
		launched. If the level type setting is Total, all estimate lines of that level
		type are launched to the project budget.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>leading estimate type (LET) calculations</SectionTitle>
      <Paragraph>
         <Link href="/baanerp/tp/glossary/glossary#000362" role="glossary">leading estimate type</Link> (LET) calculations</Paragraph>
      <Paragraph>If you click Aggregate Totals in the <GUIRef href="/baanerp/tp/est/tpest2100m000" role="session">Estimate Lines (tpest2100m000)</GUIRef> session, the structural elements’ total amount of the
		leading estimate type is calculated from the estimate lines. The result is then
		displayed in the various LET Total fields. If you work with bottom-up
		estimating, the calculation also depends on your level type settings in the <GUIRef href="/baanerp/tp/est/tpest1120m000" role="session">Structural Elements (tpest1120m000)</GUIRef> session. The LET of element 011 is top down and you
		have three top-down lines for 011 and two bottom-up lines. Consequently, only
		the top-down lines are used in the LET calculation.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Total level type calculation</SectionTitle>
      <Paragraph>In the <GUIRef href="/baanerp/tp/est/tpest2100m000" role="session">Estimate Lines (tpest2100m000)</GUIRef> session, under Cost, the following calculations of
		estimate lines totals are displayed. The LET is 60 million EURO; this amount
		depends on the view. Because the view is on the TOP element, the following
		value is displayed in the Top Down Total: EURO 60 million.</Paragraph>
      <Paragraph>The Bottom Up Total calculation differs; the structural
		elements’ amounts are added up: 011 + 023 + 022 = 5 + 15 + 1 = EURO 21 million.
		The Cost Level field type determines the selected amounts.</Paragraph>
      <Paragraph>For bottom-up estimating, you can also calculate a total with
		the Detail level type. If your level type setting in the Cost Level field type
		in the <GUIRef href="/baanerp/tp/est/tpest1120m000" role="session">Structural Elements (tpest1120m000)</GUIRef> session is Detail, the shipyard example
		amounts to the following result: 3 + 1 + 0 + 15 + 0,5 = EUR 19.5
		million.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Explanation</SectionTitle>
      <Paragraph>If you look at the bottom-up lines of 011, there is a
		difference in amount; the Total line is calculated with some slack, whereas the
		Detail lines are accurate labor hours. If the Cost Level field type is Detail,
		the total for 011 is 3 million plus the other detail lines for 011, if
		available.</Paragraph>
      <List>
         <ListIntro>Detail level-type calculation for leading estimate type
		  (LET):</ListIntro>
         <ListItem>LET of 01 = top down =&gt; estimate is EUR 9 million.</ListItem>
         <ListItem>LET of 021 = bottom up =&gt; estimate is EUR 40 or EUR 30
		  million, depending on the Cost Level field.</ListItem>
         <ListItem>LET of 03 = top down =&gt; estimate is EUR 1 million.</ListItem>
      </List>
      <Paragraph>You can use the LET total and the cost total to calculate and
		recalculate different estimates before you send out a bid. The aim is to create
		a cost estimate. With the same estimate, you can present a sales estimate with
		the required level of detail.</Paragraph>
   </GeneralSection>
   <RelatedTopics>
      <SectionTitle>Related topics</SectionTitle>
      <RelTopic>
         <Link href="/baanerp/tp/onlinemanual/000315" role="manual">To create an estimate</Link>
      </RelTopic>
   </RelatedTopics>
</ManualTopic>