MCM - Minor updates to view-amoritized-costs

Author: bandersmsft

articles/cost-management-billing/reservations/view-amortized-costs.md

@@ -7,7 +7,7 @@ ms.reviewer: primittal
 ms.service: cost-management-billing
 ms.subservice: common
 ms.topic: how-to
-ms.date: 12/18/2023
+ms.date: 03/18/2024
 ms.author: banders
 ---
 
@@ -25,19 +25,19 @@ To understand how amortized costs are shown in cost analysis for reservations, l
 
 First, let's look at a one-year virtual machine reservation that was purchased on January 1. Depending on your view, instead of seeing a $365 purchase on January 1, 2022, you'll see a $1.00 purchase every day from January 1, 2022 to December 31, 2022. In addition to basic amortization, the costs are also reallocated and associated to the specific resources that used the reservation. For example, if the $1.00 daily charge was split between two virtual machines, you'd see two $0.50 charges for the day. If part of the reservation isn't utilized for the day, you'd see one $0.50 charge associated with the applicable virtual machine and another $0.50 charge with a charge type of _UnusedReservation_. Unused reservation costs can be seen only when viewing amortized cost.
 
-Now, let's look at a one-year reservation purchased at some other point in a month. For example, if you buy a reservation on May 26, 2022 with a monthly or upfront payment, the amortized cost is divided by 365 (assuming it's not a leap year) and spread from May 26, 2022 through May 25, 2023. In this example, the daily cost would be the same for every day. However, the monthly cost will vary because of the varying number of days in a month. Also, if the reservation period includes a leap year, costs for the leap year are divided evenly by 366.
+Now, let's look at a one-year reservation purchased at some other point in a month. For example, if you buy a reservation on May 26, 2022 with a monthly or upfront payment, the amortized cost is divided by 365 (assuming it's not a leap year) and spread from May 26, 2022 through May 25, 2023. In this example, the daily cost would be the same for every day. However, the monthly cost varies because of the varying number of days in a month. Also, if the reservation period includes a leap year, costs for the leap year get divided evenly by 366.
 
-Because of the change in how costs are represented, it's important to note that actual cost and amortized cost views will show different total numbers. Depending on your view in Cost analysis, the total cost of months with a reservation purchase will decrease when viewing amortized costs, and months following a reservation purchase will increase. Amortization is available only for reservation purchases and doesn't apply to Azure Marketplace purchases currently.
+Because of the change in how costs are represented, it's important to note that actual cost and amortized cost views show different total numbers. Depending on your view in Cost analysis, the total cost of months with a reservation purchase decreases when viewing amortized costs, and months following a reservation purchase increase. Amortization is available only for reservation purchases and doesn't apply to Azure Marketplace purchases currently.
 
 Although the preceding example shows how to calculate amortized costs for a reservation, the same logic applies to a savings plan. The only difference is that you use the charge type of _UnusedSavingsPlan_ instead of _UnusedReservation_.
 
 ## Metrics affect how costs are shown
 
 In Cost analysis, you view costs with a metric. They include Actual cost and Amortized cost. Each metric affects how data is shown for your benefit charges.
 
-**Actual cost** - Shows the purchase as it appears on your bill. For example, if you bought a one-year reservation for $1200 in January 2022, cost analysis shows a $1200 cost in the month of January for the reservation. It doesn't show a reservation cost for other months of the year. If you group your actual costs by VM, then a VM that received the reservation benefit for a given month would have zero cost for the month.
+**Actual cost** - Shows the purchase as it appears on your bill. For example, if you bought a one-year reservation for $1200 in January 2022 and you paid for the entire purchase cost upfront, then cost analysis shows a $1200 cost in the month of January for the reservation. It doesn't show a reservation cost for other months of the year. However, if you're paying the reservation on a monthly basis, then you see this recurring cost on the monthly anniversary date. If you group your actual costs by VM, then a VM that received the reservation benefit for a given month would have zero cost for the month.
 
-**Amortized cost** - Shows a reservation purchase split as an amortized cost over the duration of the reservation term. With the same example above, cost analysis shows a different amount for each month depending on the number of days in the month. If you group costs by VM in this example, you'd see cost attributed to each VM that received the reservation benefit. However, _unused reservation_ costs are not attributed to the subscription used to buy the reservation because the unused portion isn't attributable to any specific resource or subscription. Similarly, unused saving plan costs are not attributed to the subscription used to buy the saving plan.
+**Amortized cost** - Shows a reservation purchase split as an amortized cost over the duration of the reservation term. With the same previous example, cost analysis shows a different amount for each month depending on the number of days in the month. If you group costs by VM in this example, you'd see cost attributed to each VM that received the reservation benefit. However, _unused reservation_ costs aren't attributed to the subscription used to buy the reservation because the unused portion isn't attributable to any specific resource or subscription. Similarly, unused saving plan costs aren't attributed to the subscription used to buy the saving plan.
 
 ## View amortized costs
 
@@ -48,9 +48,9 @@ By default, cost analysis shows charges as they appear on your bill. The charges
 
 Amortized costs are available only for reservations and savings plans. They aren't available for Azure Marketplace purchases. However, virtual machine software usage reservations available in the Azure Marketplace are supported.
 
-Depending on the view you use in cost analysis, you'll see different benefit costs. For example:
+Depending on the view you use in cost analysis, you see different benefit costs. For example:
 
-When you use the **DailyCosts** view with a date filter applied, you'll easily see when a benefit was purchased with an increase in actual daily costs. If you try to view costs with the **Amortized cost** metric, you'll see the same results as **Actual Cost**.
+When you use the **DailyCosts** view with a date filter applied, you easily see when a benefit was purchased with an increase in actual daily costs. If you try to view costs with the **Amortized cost** metric, you see the same results as **Actual Cost**.
 
 Let's look at an example one-year benefit purchased for $12,016.00, purchased on October 23, 2019. The term ends on October 23, 2020, and a leap year day is included in the term, so the term's duration is 366 days.
 
@@ -64,14 +64,14 @@ In the Azure portal, navigate to cost analysis for your scope. For example, **Co
     :::image type="content" source="./media/view-amortized-costs/reservation-purchase.png" alt-text="Screenshot showing a reservation purchase in Cost analysis." lightbox="./media/view-amortized-costs/reservation-purchase.png" :::
 4. Under **Scope** and next to the cost shown, select the down arrow symbol and then select **Amortized cost** metric. Here's an example showing the daily cost of all reservations for the selected date range. For the highlighted day, the daily cost is about $37.90. Azure accounts for costs to further decimal places, but only shows costs to two decimal places.  
     :::image type="content" source="./media/view-amortized-costs/daily-cost-all-reservations-amortized.png" alt-text="Screenshot showing daily amortized cost for all reservations in Cost analysis." lightbox="./media/view-amortized-costs/daily-cost-all-reservations-amortized.png" :::
-5. If you have multiple reservations (the example above does), then use the **Group by** list to group the results by **Reservation name**. Here's an example showing the daily amortized cost of the reservation named `VM_WUS_DS3_Upfront` for $32.83. In this example, Azure determined the cost by: $12,016 / 366 = $32.83 per day. Because the reservation term includes a leap year (2020), 366 is used to divide the total cost, not 365.  
+5. If you have multiple reservations (the previous example does), then use the **Group by** list to group the results by **Reservation name**. Here's an example showing the daily amortized cost of the reservation named `VM_WUS_DS3_Upfront` for $32.83. In this example, Azure determined the cost by: $12,016 / 366 = $32.83 per day. Because the reservation term includes a leap year (2020), 366 is used to divide the total cost, not 365.  
     :::image type="content" source="./media/view-amortized-costs/daily-cost-amortized-specific-reservation.png" alt-text="Screenshot showing the daily amortized cost for a specific reservation in Cost analysis." lightbox="./media/view-amortized-costs/daily-cost-amortized-specific-reservation.png" :::
 6. Next, change the **Granularity** to **Monthly** and expand the date range. The following example shows varying monthly costs for reservations. The cost varies because the number of days in each month differs. November has 30 days, so the daily cost of $32.83 \* 30 = ~$984.90.  
     :::image type="content" source="./media/view-amortized-costs/monthly-cost-amortized-reservations.png" alt-text="Screenshot showing the monthly amortized cost for a specific reservation in Cost analysis." lightbox="./media/view-amortized-costs/monthly-cost-amortized-reservations.png" :::
 
 ## View benefit resource amortized costs
 
-To charge back or show back costs for a benefit, you need to know which resources used the benefit. Use the following steps to see amortized costs for individual resources. In this example, we'll examine November 2019, which was the first month of full reservation use.
+To charge back or show back costs for a benefit, you need to know which resources used the benefit. Use the following steps to see amortized costs for individual resources. In this example, we examine November 2019, which was the first month of full reservation use.
 
 1. Select a date range in the benefit term where you want to view resources that used the benefit.
 2. Add a filter for **Pricing Model: Reservation** to see only reservation costs.
@@ -90,5 +90,5 @@ Another easy way to view reservation amortized cost is to use the **Reservations
 
 ## Next steps
 
-- Read [Charge back Azure Reservation costs](charge-back-usage.md) to learn more about charge back processes for reservations.
-- Read [Charge back Azure saving plan costs](../savings-plan/charge-back-costs.md) to learn more about charge back processes for savings-plans.
+- To learn more about charge back processes for reservations, read [Charge back Azure Reservation costs](charge-back-usage.md).
+- To learn more about charge back processes for savings-plans, read [Charge back Azure saving plan costs](../savings-plan/charge-back-costs.md).