Hello
My widget factory recieves orders from a distributor for production. My
workers dont always produce the ordered amount. My distributor has set up a
penalty clause as follows.
For up to 2 widgets or 1.5% of order (which ever is greater) he will accept
for up to 10 widgets or 7.5% of order (whichever is greater) yeilds a 10%
penalty
for greater than 10 or 7.5 % yields a 25% penalty.
For under production, I pay the penalty X his cost
For over production I am paid cost less the penalty.
The penalty is applied as follows:
If my order is 100 the break points would be 2 and 10
If my production is 85 then the penalty would be 8*90%Cost
and 5*75% Cost


What formula would I use to calculate this?
Thanks!