Average cost Clause Samples
The "Average cost" clause establishes a method for determining the value of goods, services, or assets by calculating the average of their costs over a specified period or batch. In practice, this clause is often used in contracts involving inventory or supply agreements, where the price paid or reimbursed is based on the mean cost of items acquired or produced, rather than the actual cost of each individual item. By applying an average, the clause helps to smooth out price fluctuations and provides predictability for both parties, ensuring fairness and reducing disputes over variable costs.
Average cost. Based on past cost information, a govern- mental unit determines an average cost per unit of materials and labor for the installation of a urban best management practice which may not be exceeded. A governmental unit may use its own experience, or information obtained from the department or other sources, to estimate typical costs.
Average cost. For purposes of this Agreement, "Average Cost" means the ------------ average price paid by Valley for each Product by Stock Keeping Unit ("SKU"). Average Cost is calculated as follows: as Product is purchased by Valley, the costing system recalculates, at the time of receipt processing, the average price for each SKU in Valley's inventory. This costing system incorporates full case pack purchases (i.e., "Box Lots") as well as purchases in less than Box Lot quantities (i.e., "Loose Piece" purchases), each by SKU. The Average Cost calculation includes Box Lot incentives, new release discounts, ongoing and periodic catalog discounts, and one-time discounts. The Average Cost calculation does not include cash discounts for timely payment by Valley, ______________________ *Confidential treatment is requested for confidential information enclosed in brackets and underlined. [***] Confidential treatment has been requested for the bracketed portions. --- The confidential redacted portion has been omitted and filed separately with the Securities and Exchange Commission. return incentives, advertising incentives or volume rebates. In addition, specially negotiated prices on purchases from secondary, nontraditional sources (e.g., inventory purchased in connection with corporate acquisitions, outsourcing contract, and liquidation), shall not be included in the Average Cost calculation.