I. INTRODUCTION

CARS+ provides the ability for Rate Products to be "inclusive" where items, in addition to the time charge, are included in the rate. This chapter provides the user with instructions for setting up and using inclusive rates as well as an explanation of how inclusive rates are handled by a variety of programs within CARS+.

II. DEFINITIONS

Inclusive Rate – In this chapter the term inclusive rate refers to any Rate Product where the rate includes more than just the charge for time. For instance, it may include LDW, other coverages, surcharges and/or taxes.

Option Set - An Option Set is a group of options, coverages, fees, and/or taxes which can be designated as the included items on an inclusive rate. Alternatively, an Option Set can also define an option or group of options that are added automatically to a RA as chargeable items when a Rate Product is used. This feature is discussed in the Edit Option Set chapter of the CARS+ Manual.

Unbundling - In this chapter the term unbundling refers to a process that CARS+ uses to divide up the inclusive rate and allocate the revenue to each of the included items.

III. REQUIRED SET-UP STEPS

A. EDIT OPTION SET CODES

This program is used to create groups of options that may be included in a Rate Product.

The Option Set Codes screen below shows 3 options sets: A, B, and C.

"A" includes the additional driver fee (DRIVR), LDW, sales tax (TAX), and airport fee (APTAX)

"B" includes underage driver fee, the airport fee (APTAX), LDW, sales tax, and Vehicle License Fee (VLF).

"C" includes LDW, PAI, the additional driver fee, and sales tax.

OPTION: __ EDIT OPTION SET CODES # * Code Item Eff Date Term Date 01 A DRIVR 01-01-16 12-31-17 02 A LDW 01-01-16 12-31-17 03 A TAX 01-01-16 12-31-17 04 A APTAX 01-01-16 12-31-17 05 B AGE24 01-01-16 06 B APTAX 01-01-16 06 B LDW 01-01-16 07 B TAX 01-01-16 08 B VLF 01-01-16 10 C LDW 03-01-16 11 C TAX 03-01-16 12 C DRIVR 03-01-16 13 C PAI 03-01-16

• Percentage-based charges. Note that when taxes and other percentage-based fees (like a surcharge or airport facility charge) are included, the tax or fees included cover only the items in the Option Set plus the Time charge. In other words, the tax on the rate is included. If the customer rents a child seat or takes a coverage that is not part of the inclusive rate, they are responsible for the tax on those items.
• Flat fee charges. Charges calculated on a flat-fee basis can be made inclusive.
• Fuel: Fuel cannot be listed as an item included in an Option Set. To include Fuel in an inclusive rate, bring up the rate record in Edit Rental Rules/Rates. Enter a "Y" in the "FPO Inc" (Fuel Purchase Option Included) field. Note that no allocation will be made to fuel when the rate is unbundled.

B. EDIT RENTAL RULES/ RATES

A Rate Product is designated as 'inclusive' when a valid Option Set Code is entered in the Inclusive Option Set field on page 1 of the Edit Rental Rules/Rates record.

Data Field 36. INCL OPT SET

This field is used to define a Rate Product as inclusive. Entering an Option Set Code in this field defines which items are included in the rates entered on the rates page of the record.

Using the Option Set examples above, entering an "A" in this field would mean that the Under 25 charge, LDW, and sales tax are included in the rate. The sales tax included is on the options listed as well as the sales tax on the time charges.

Data Field 38: FPO INC

This field is used to indicate whether or not the Fuel Purchase Option is included in the rate. Enter "Y" to include it. If it is included, however, no allocation will be made to fuel when the rate is unbundled.

Data Field 51: MILES IN INCL

Indicate if the mileage charge is tax inclusive. Enter:

Y= All percentage based options that are included in the Time charge by means of an inclusive Option Set which are also defined in the Percentage Matrix as applying to Mileage will be extracted from the mileage charge, and, therefore, will be hidden as are all other extracted charges.

N (or blank) = Percentage based charges that are included in the Time charge are not included in the Mileage charge. Therefore, if they apply to the mileage charge, they will appear on the rental as an additional calculated charge, calculated on top of the mileage charge.

IV. HOW IT WORKS

A. RESERVATIONS AND RA OPEN

Rate Subwindow

The rate displayed in the A subwindow is the total inclusive rate ($50 per day in the example below.)

OPTION: ______________ TIMES & MILEAGE RATES Option EffDt Dy-Rate/ml Wk-Rate/ml Mt-Rate/ml Xd-Rate/ml Hrs-Rate/ml 1 RETL 06-10 50.00/* 300.00/* */* */* 15.00/* 2 MILE */* */* */* */* */* 3 * */* */* */* */* */* 4 * */* */* */* */* */* 5 * */* */* */* */* */* 6 * */* */* */* */* */* 7 * */* */* */* */* */* 8 Free miles/Yield */* F2 NEXT 7F4 PREV 7

Rules Window

Although there is no indication in the T & M Rates subwindow (above) that the rate is inclusive, the included items are indicated in the Rules subwindow. (example below)

OPTION: ______________ RATE RULES Set/date A/01-05-16/0000 Alt rates */* ---Included Items--- Min days/Chg-to */* Pric code/RQ/PMA 3/*/* LDW Max days/Chg-to */* Fuel rate Out/In */* DRIVR Intercity Chg-to * Effective Optsets TAX Disc/Edit/TaxInc N/Y/* Inclusive A APTAX Grace/Charge for 60/Y Addon * Cal Clc/Week min */* Exempt * Yield Pcts */*/*/*/* Orig RQ/Incl FPO */Y Surcharge exempt * Paid/Free Days */* INCLA/INCLUSIVE SET A

Option Pop-Up Window

When a rate is inclusive, the included items are blocked from being sold in the Option Pop-Up window on the RA Open and Reservation screens. Instead, the included items are marked with a "X" as illustrated below.

Select optional charge items                             
  C=Charge  *=No charge                                  
 Option     C/*       Rate     Calc    Qty  Deductible   
 LDW         X      16.00     /DAY             500      
 PAI         *       7.00     /DAY                      
 PEC         *       5.00     /DAY                      
 SLI         *       9.00                
 SKI RACK    *       2.00     /DAY                      
 MAPS        *       3.00     /DAY                      
 LOCK        *       4.00     /ITM                      
                                                         
 Press Return Here to Accept Changes [ ]

If an attempt was made to mark LDW as sold by entering a "C" in place of the "X", the following message would display:

LDW CANNOT BE SOLD

And the "C" would be replaced automatically by the "X".

Inclusive Items Window

On the Reservations and RA Open screens the inclusive items are shown in detail in the Inclusives subwindow:

• Reservations: Subwindow X
• RA Open: Subwindow AI

Estimate

The estimate also shows which items are included in the rate.

Assume that Option Set A is applied to an inclusive Rate Product where the rate for a compact car is $50 per day.

EXAMPLE 1: One-day rental; no additional items are sold to the renter.

The F8 Estimate would display as follows:

                   DAYS   :    1 @   $50.00 =   $50.00        
                   LDW    :                             incl        
                   DRIVR  :                             incl        
                   APTAX  :                             incl
                   TAX    :                       0.00  *        
                   TOTAL  :                     $50.00

For tax type options, an asterisk is shown. When the tax and all items it is applied to are included in the rate, the amount for the tax is zero (as illustrated above.) When some taxable items are included in the rate and some are not, the amount of the tax on the non-included items is shown in the estimate (as illustrated below.)

EXAMPLE 2: One-day rental and the renter takes PAI.

The F8 Estimate would display as follows:

.                       DAYS   :    1 @   $50.00 =   $50.00    
                        LDW    :                            incl
                        DRIVR :                             incl
                        PAI    :                      $9.00    
                        TAX    :                      $ .63  * 
                        TOTAL  :                     $59.63

Notice that because an additional taxable item has been added to the RA, the amount of $.63 is shown for sales tax ( $9.00 PAI at 7% sales tax). The asterisk (*) to the right is used to note that tax is included in the inclusive rate of $50.

Conditional Items. When conditional options are included in an Option Set, they are handled in a unique way. If the item appears on the RA, revenue is allocated to it. If the item does not appear on the RA, revenue is not allocated to the item. The revenue that would have been allocated to it is allocated to the Time charge.

EXAMPLE 3: Continuing to use Option Set A as above which includes the additional driver, assume that an additional driver was not added to the RA. (And no other items were added either.) During the saving process on RA Open, the following message would appear:

ADD DRIVR OPTIONAL CHARGE REMOVED

Upon bringing up the saved RA on the Open screen, an estimate would show as follows:

                   DAYS   :    1 @   $50.00 =   $50.00        
                   LDW    :                             incl        
                   APTAX  :                             incl
                   TAX    :                       0.00  *        
                   TOTAL  :                     $50.00

B. RA CLOSE

Main Window: When an Option Set is present on the RA, the two fields just below Field 1 of the Main Window change to "Inclusive Rate" and "Other Charges" as shown below:

OPTION: __________ RA CLOSE 1 Miles/Fuel/Chg */*/* 5 Empl/Drw */* Inclusive Rate * 6 Notes * Other Charges * FOP 2 Discount * 3 Tax/Surcharge * A-T&M Charges name: Subtotal-1 * C-Option Charges date: Less Dep/Reimb * D-Payments odom: Less Payments * E-Other Charges veh#: 4 Change Back * F- RA Open Bill-To: Balance * O-Other Windows N-Notes F1=CLOSE RAF2=SWIPE F3=ERASE F4=CALCULATE F12=CHECK AUTH ESC=EXIT

The total charge for the inclusive rate is shown where the Time & Mileage charges are normally shown.

The total for any other charges not included in the rate are shown on the next line.

Rate Subwindow. Like the Rate subwindow of RA Open, the rate that displays in the A subwindow on the Close screen is the total inclusive rate. A sample illustration is shown below for the $50/day inclusive rate.

OPTION: __ TIME & MILEAGE CHARGES Elapsed: hrs: 22:06 dys: 1 wks: 0 mo: 0 miles: 51 free: 0 Class CCAR Option EffDt Days/Rate Weeks/Rate Mths/rate Xdys/Rate Hrs/Rate Charge 1 INCL 06-10 1/50.00 */300.00 */* */* */15.00 *50.00 2 MILE 181/* */* */* */* */* * 3 * */* */* */* */* */* * 4 * */* */* */* */* */* * 5 * */* */* */* */* */* * 6 * */* */* */* */* */* * 7 * */* */* */* */* */* * F2 NEXT 7 F4 PREV 7

Inclusive Subwindow. The purpose of Subwindow X is to display the allocation of the inclusive rate. An example is shown below.

OPTION: ______________ RATE INCLUSIVE ITEMS Page:01 Option Qty Days/Rate Weeks/Rate Mths/rate Xdys/Rate Hrs/Rate Charge 1 ADD DRIVR 1 1/6.50 */* */* */* */* 8.00 2 LDW 1 1/16.00 */* */* */* */* 16.00 3 TAX 1 */7.00 */* */* */* */* 4.06 4 APTAX 1 1/3.00 */* */* */* */* 3.00 5 * * */* */* */* */* */* * 6 * * */* */* */* */* */* * 7 * * */* */* */* */* */* * F2 NEXT 7 F4 PREV 7

C. DBR & Account Summary

Just as they are shown in the inclusive subwindow on the RA Close screen, inclusive rates are unbundled on the individual columns of the Operations DBR and the Accounting DBR. The revenue is allocated to the various items included in the rate. When the Accounting DBR is run with Option Detail, the Option line for Time is the unbundled amount allocated to Time. (The amount in the Time column is also the unbundled amount allocated to Time). The Account Summary Report shows the revenue being allocated to the G/L accounts for the included items. The Revenue Analysis Report also observes the unbundling allocation.

D. Other CARS+ Reports

The following reports exclude inclusive options from reported revenue:

Employee Performance Report
Tour Profitability Report

The following reports have a field to allow the user to chose whether inclusive options should be excluded from reported revenue:

Extra Revenue Report
Extra Revenue Report 2

V. HOW RATES ARE UNBUNDLED

A. Retail Rates

General Rules:

• Extraction is NOT done to the individual day/week/month rates. Instead, the inclusive (bundled rate) is calculated for the rental period and extraction is done on the resulting calculated charge.
• All items except for Time are extracted from the calculated charge with the remainder defined as the Time revenue.
• Items that are not calculated on a percentage basis are extracted using the retail rate that is appropriate for the rental transaction (that is, using the Pricing and Privilege Codes that would be used if the option was added to the contract as an additional add-on charge).
• For percentage based items, the extraction logic is controlled by the records in the Percentage Matrix file.

Extraction Order -- The following rules apply to the order in which items are extracted from the rate:

• When the total amount to be extracted is less than the total calculated bundled charge:

1. First any non-percentage-based item(s) that do not have any percent-based item(s) applied to them are extracted. Example: Any per-day or flat-fee item that does not have any percent-based taxes or fees applied to it.
2. Then percent-based item(s) which apply to the greatest number of non-percent-based items are extracted.
3. Any non-percent-based item(s) taxed by the item(s) extracted above, but not taxed by those percent-based item(s) not yet extracted are removed.
4. The percent-based item(s) applying to the greatest number of items not yet extracted are calculated and extracted.
5. Any non-percent-based item(s) taxed by the item(s) extracted above, but not taxed by those percent-based item(s) not yet extracted are removed.
6. Repeat steps 4 and 5 above until all items have been extracted.

• When the total amount to be extracted is greater than the total calculated bundled charge. Example: When the remainder from the extraction procedure above is either zero or negative (that is that the rate was not large enough to support all the items that are included), the following alternate extraction then takes place:

1. One cent per day for daily charges is allocated to each non-percentage-based item other than Time and the charge for each is extracted from the total calculated bundled charge.
2. Flat fees are extracted.
3. All percentage based items are extracted.
4. The remainder is allocated to Time.

Example Extraction

The extraction logic used for non-percentage-based items (per-day, flat fee, etc.) is fairly straightforward. The total charge for the item, as would have been calculated if the item had not been included, is subtracted from the "starting" (available) bundled charge amount at the appropriate point in the extraction process.

For percentage-based items, the extraction logic uses algebraic equations to solve for the extraction amount. The example below uses basic algebra to solve for the unknown (x) which will be the amount of bundled revenue remaining after the item has been extracted. Subtracting this amount from the "starting" (available) amount for bundled revenue yields the amount to be extracted for that particular percentage-based item.

Note that the amount of bundled revenue remaining after each round of extraction becomes the starting amount for bundled revenue available for the next round of extraction.

The following summarizes the Percentage Matrix records used for the example below:

• VAT applies to all items on the RA.
• Sales Tax applies to all charges except VAT.
• VLF is not subject to Airport Fee, but is subject to VAT and Sales Tax.
• A/C Surcharge and LDW are subject to VAT, Sales Tax and Airport Fee.

The following rules apply to the example below:

• The rental length is 6 days.
• The total bundled charge for Time is $376.00.
• The following items are included in the rate:
• VAT at 5%
• Sales Tax at 8%
• VLF at $0.59 per day
• Airport Fee at 14.29%
• LDW at $25.95 per day
• A/C Surcharge at $0.59 per day

Step 1

Extract any non-percentage-based items which are not subject to any percentage-based items. There are no such items on this RA. Therefore the percentage-based item(s) which apply to the greatest number of non-percentage-based items are extracted first. In this case, that is the VAT. The formula for extraction is:

1x + .05x = 376.00
    1.05x = 376.00
        x = 358.10 = Bundled revenue remaining after extraction
      VAT = 376.00 – 358.10
      VAT = 17.90

Step 2

Extract any non-percentage-based item(s) which were subject to the percent-based item(s) extracted above (VAT in this example) but not subject to any percent-based item(s) not yet extracted. There are no such items on this RA. Therefore the percentage-based item(s) applying to the next greatest number of items is extracted next. In this case, that is the Sales Tax which applies to everything except the VAT. The formula for extraction is:

1x + .08x = 358.20
    1.08x = 358.10
        x = 331.57  = Bundled revenue remaining after extraction
Sales Tax = 358.10 – 331.57
Sales Tax = 26.43

Step 3

Extract any non-percentage-based item(s) which are subject to the percent-based item(s) extracted above (VAT and Sales Tax in this example) but not subject to any percent-based item(s) not yet extracted. In this case, that is the VLF. The formula for extraction is:

   VLF = 6 x 0.59
   VLF = 3.54
     x = 331.57 - 3.54
328.03 = Bundled revenue remaining after extraction

Step 4

Extract the percentage-based item(s) not applying to any item already extracted but which apply to the greatest number of items not yet extracted. In this case, that is the Airport Fee. The formula for extraction is:

1x + .1429x = 328.03    
    1.1429x = 328.03
          x = 287.02 = Bundled revenue remaining after extraction
Airport Fee = 328.03 - 287.02
Airport Fee = 41.01

Step 5

Extract any non-percentage-based item(s) which were subject to the percent-based item(s) extracted above (VAT, Sales Tax and Airport Fee in this example) but not subject to any percent-based item(s) not yet extracted. In this case, that is the LDW and the A/C Surcharge. The formula for extraction is:

LDW = 6 X 25.95
LDW = 155.70

A/C Surcharge = 6 X 0.59
A/C Surcharge = 3.54

Time = 287.02 – 155.70 – 3.54
Time = 127.78

At this point all items have been extracted. The remaining Time revenue on this RA is $127.78.

B. Notes on Voucher (wholesale) Rates

1. If a V subwindow voucher with an inclusive rate is placed on a RA, the retail rate on the RA must be either non-inclusive or must have the same Option Set as the voucher's net rate.
2. The V subwindow displays the Option Set Code as follows:
1. For complex wholesalers, the Option Set Code of the net rate
2. For simple wholesalers, the Option Set Code of the RA's retail rate from the Main Window.

3. As with retail rentals, the included items are noted in the Option pop-up window with an "X".
4. Unbundling the net rate:
1. Complex wholesaler: The voucher rate is unbundled in the same manner as retail rate described earlier.
2. Simple wholesalers: For a simple net rate, the discount is applied before the rate is unbundled using the same logic.
3. Items included in the voucher are calculated using the voucher days; not the elapsed days of the RA.

5. Out of voucher charges that are charged to the renter:
1. For out of voucher charges, flat fee items calculate as usual.
2. Items charged on a time basis or a percentage basis that are not represented in the inclusive rate will calculate as usual.
3. Items charged on a time basis that are also represented in the inclusive rate are calculated for "out of voucher chargeable days" (elapsed days minus voucher days).
4. Items charged on a percentage basis that are also represented in the inclusive rate will be calculated on the other items outside of the voucher. For example, if Tax is included in the voucher but is applied to a non-inclusive charge, the amount of tax on that charge will not be inclusive. There will be two RA Charge records for the tax: An inclusive record which is the tax on the included items and a non-inclusive record for the tax on the non-inclusive items.
5. If the voucher is set to be Intercity Inclusive, , but the drop city changes at RA Open or RA Close, the drop will no longer be included in the voucher. Will be charged to the renter.

6. As is standard for vouchers, the RA Estimate and the RA Close screen calculations will not display any items included in the voucher.
7. Details of voucher charges (inclusive items) are printed on the RA Invoice (versions E and B) and the Voucher Invoice (versions T, 2, and B).