# AI cost formulas and decisions

Import true-cost.csv and fill values only with a source or an explicit estimate. Keep currency units and periods consistent. The CSV provides input rows and formula instructions, not executable spreadsheet formulas.

## Cash comparison

- Recurring subscription = price per seat per month multiplied by seats and months.
- Recurring cash = subscription plus usage, hosting, and required connection costs for the same period.
- First-period cash cost = recurring cash plus actual one-time external setup and purchases.
- Monthly net cash benefit = supported actual monthly expense reduction minus new monthly recurring cash costs.
- Cash payback = supported one-time cash cost divided by positive monthly net cash benefit. Leave undefined if that benefit is unknown, zero, or negative.

Don't use the labor value calculation below as actual cash savings unless spending changed. Don't add forecast revenue to force a favorable decision.

## Capacity comparison

- Monthly hours reclaimed = comparable manual hours before minus total hours after, including review, corrections, and recurring upkeep.
- First-period net hours reclaimed = monthly difference multiplied by months, minus one-time internal setup and learning hours.
- An optional labor-value estimate = hours multiplied by an agreed loaded hourly rate. Keep it labeled as an estimate, separate from actual cash.

## Worked teaching arithmetic

Fictional inputs: 3 manual hours per month, 2 hours afterward including review, and 4 one-time setup hours. The simplified monthly capacity difference is 1 hour. Four comparable months offset the 4 setup hours only if that difference persists. No cash saving, revenue, vendor price, or client result is supplied.

## Inspect the decision

Check comparable work, periods, and definitions. Record errors and quality failures alongside time. Leave missing vendor costs unknown. Consider fallback and exit effort. Continue a trial, adopt, revise, or reject the tool using the observed job and constraints; there is no universal payback cutoff.