Glossary / True-up
Glossary
True-up
A line that bills the gap between what your activity cost and what a minimum required.
What it means
If the contract sets a $5,000 monthly minimum and your activity priced out at $4,200, a true-up bills the $800 difference as its own line.
What goes wrong
It is calculated on the wrong base — gross before credits, or including charges the minimum was not meant to cover. And because it appears only in slow months, it rarely gets compared against the previous invoice.
The arithmetic
Contract · minimum $5,000.00, measured against all
fulfillment charges.
Charges that count toward it
Pick and pack $3,100.00
Receiving $700.00
Storage $1,400.00
----------
$5,200.00
The minimum is cleared. No true-up is due.
Billed as though only pick and pack counted
$5,000.00 − $3,100.00 = $1,900.00
Overbilled $1,900.00How to check it
Price the month, subtract from the minimum, and compare to the true-up line. Anything else means the base is wrong.