Current price by cumulative progress against discrete values - excel

Question

I have to implement a set of formulas in Excel whose requirements seem to defy any logical or succinct way to do them with just formulas.
Short Description:
determine (and display) a timeline of a product's "effective" internal cost each day based on 1) the price paid for the product as a series of bulk purchases, and 2) the company's per-day consumption of the product using the price paid for each purchase, until the purchased amount is consumed and then moving on to the next purchase.
Simplified Details:
We have a sheet "PurchSums" with the product's bulk purchase history: (this is actually a pivot table)
| A | B | C | D |
1: Product Name Purch Date Rate Amount
...
23: Prod-Q 12/18/2012 $3.15 123.7
24: 1/24/2013 $3.05 748.2
25: 2/27/2013 $2.86 650.0
... ...
So initially, the internal price should be $3.15/pound until the first 123.7 pounds are used us, then it should switch to $3.05 and so on.
We have a sheet "Volumes" with consumption by day: (product consumption starts on March 1st)
| A | B | C | D |
1: Product Name 3/1/2013 3/2/2013 3/3/2013 ...
...
12: Prod-Q 87.2 77.1 101.5 ...
... ...
And I need to fill in formulas for the daily price sheet "Prices", which has the product's effective internal price for each day (filled-in by hand now):
| A | B | C | D |
1: Product Name 3/1/2013 3/2/2013 3/3/2013 ...
...
32: Prod-Q 3.15 3.15 3.05 ...
... ...
Note here that the price for "Prod-Q" changed to 3.05 on March 3rd. This is because its cumulative consumption reached 265.8 pounds (87.2 + 77.1 + 101.5) which exceeded the 12/18 purchase of 123.7 pounds and so switched from its price of 3.15 to the price of the next purchase from 1/24.
More Details:
The first sheet "PurchSums" is actually a pivot table, if that helps. Unfortunately, I don't think that it does, nor that GETPIVOTDATA(..) is going to be useful here (but I would be happy to be wrong). The information in it comes from another sheet "Purchases" which is just a list of all of the purchases:
| A | B | C | D |
1: Product Name Purch Date Rate Amount
...
11: Prod-Q 12/18/2012 $3.15 123.7
...
34: Prod-Q 1/24/2013 $3.05 748.2
...
67: Prod-Q 2/27/2013 $2.86 650.0
...
Additional:
First, I would like to do this as much as possible with Formulas in the existing cells/sheets. Plus I would like to minimize the number of additional sheets that have to be added to support this, as the workbook is already pretty substantial.
Secondly, yes I know that I could do this with VBA functions, and I will do that if there's no better way, but I would like to avoid that if possible because in my experience, populating the formulas of large sheets with massive VBA function calls can lead to some significant performance issues.
I would be grateful for any ideas on how to effectively approach this.

Answer 1

So what you are describing is a FIFO inventory accounting system. First In First Out. You might want to read up on it here:
http://en.wikipedia.org/wiki/FIFO_and_LIFO_accounting
and here:
http://accountingexplained.com/financial/inventories/fifo-method
Basically under FIFO you are making the assumption(whether right or wrong) that the first items that you are adding to your inventory are the first ones you are going to use up in your production. As opposed to LIFO which makes the assumption that the last items that you add to your inventory are the first ones that you are going to use up. That would only require a small change in my solution but let's focus on FIFO since that is your question.
So for every day that you operate you need to figure out how much of your inventory you used up and how much you paid for that inventory. So if you bought 20 items at 50 dollars and then another 20 items at 100 dollars the next day - and on the third day you used up 30 of the items in production, you used up (20 * $50 ) plus ( 10 * $100 ) = $2000 worth of inventory. 2000 / 30 = your effective cost of the product for the day(66.6666667). This effective cost is purely informational for the day - you probably wouldn't want to use it for any accounting - although you could with some rounding corrections - it would just be an indirect way to go about it.
So my solution uses a really ugly table. Basically for every day that you operate you need to figure out how much of your inventory you are using up and how much you paid for that inventory - and then divide it by the total amount used up in the day. Something like this should work for you:
=(IF(AND($E8>G$4,$E8>G$5),G$3,0)+IF(AND($E8>G$4,$E8<G$5),($E8-G$4),0))-SUM(G$7:G7)
=(IF(AND($E9>G$4,$E9>G$5),G$3,0)+IF(AND($E9>G$4,$E9<G$5),($E9-G$4),0))-SUM(G$7:G8)
=G8*$C8
=SUM(G13:G15)/G3
These formulas are all auto-fillable. And you could add on to this table as much space as you need(and probably improve it quite a bit). A small program in almost any language could accomplish this much easier and more intuitively than excel - but this works fine.
In practice, oftentimes nobody really knows which pieces of inventory are being used up and thus how much you paid for them. But the system persists nonetheless - usually the reason many accounting practices are done are the same as why the ancient peoples of the earth sacrificed animals - because that's how it's always been done - tradition and folklore. And for the most part it serves them quite well - routine sources of protein are healthy. I could think of some better ways to do it but - alas. Good Luck.

Answer 2

Assuming you know how to:
display product names on every row from the pivot table
extract lower- and upper-bound interval points from the Amount values from the pivot table
sum Volumes from all previous days from the correct row for each product
cover edge cases like volumes outside defined amount intervals
use Office 2007+ tables
use named ranges
...
For the first day, you want the maximum price = the first row for a given product name:
=INDEX(PurchSums[Rate], MATCH(this_row_product_name, PurchSums[Product Name], 0))
For every other day, you want to sum Volumes from all previous days and extract the rate from matching interval of Amounts for a given product name:
=SUMIFS(PurchSums[Rate],
PurchSums[Product Name], this_row_product_name,
PurchSums[Amount above], TEXT(sum_of_previous_volumes_for_product, "<=General"),
PurchSums[Amount up to], TEXT(sum_of_previous_volumes_for_product, ">General"))
Note that sum_of_previous_volumes_for_product > PurchSums[Amount above] and all the other conditions should be met in 1 row only, so we sum exactly 1 row.
Example:
For cell E16 the named ranges would be replaced / point to:
this_row_product_name = Prices[[#This Row],[Product Name]] = Prices[#Product Name] = $B16
sum_of_previous_volumes_for_product = =SUM(OFFSET(Volumes[[#Headers],[2013-03-01]:[2013-03-02]], MATCH(this_row_product_name, Volumes[Product Name], 0), 0)) = SUM($C12:D12)

Answer 3

So basically you want to summarize your "PurchSums" sheet and "Volumes" ones into one that combines the date fields??
If this is the case....
In your summary sheet make a row filled with the dates
Make a column for Purchase amount
Make a column for Volume amount
Under the Purchase amount use a match / index formula like this:
=index({Select the column C from "PurchSums"},match( {Select date from third sheet},{Select date column from "PurchSums"},0))
Similarly do the same thing for the Volume column.
Hope this gets you on your way if I am not far off on what you are trying to accomplish.