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Calculating Total Amount with Partial Period Proration

This article introduces how to calculate total amount for recurring charges with partial period proration. It gives you the formulas and examples of calculating total amount and prorated amount.

Calculating Total Amount with Partial Month Proration

With recurring charges for any periods less than a month, the total amount is equal to the sum of prorated amount for partial months plus charge amount for full months.

The calculation of prorated amount for partial months depends on the setting of the following billing rules:

If Bill recurring charges for partial month (with monthly based billing periods)? is set to Yes, prorated amount is calculated. You can choose to calculate prorated amount either using 30 days in a month or using actual days in a month by setting the When prorating a month, assume 30 days in a month or use actual days? billing rule.

The following table describes formulas and examples of total amount calculation with different billing rules.

When prorating a month, assume 30 days in a month When prorating a month, use actual days

Total_amount = Price_per_month * (Number_of_full_months + (Prorated_days/ 30) )

Example 1

Total_amountPrice_per_month * (Number_of_full_months + (Prorated_days/Actual_number_of_days_of_the_prorated_month) )

Example 2

Example Scenario:

  • Charge Model: Per Unit Pricing
  • List Price: $100 with the list price base option of Month
  • Unit: 1 
  • Billing Period: Month
  • Subscription Term Start Date: 01/01/2018
  • Subscription Term: 12 months
  • Trigger Condition: Upon Contract Effective
  • End Date: Align to Subscription End Date 
  • Billing Day: Specific Day of Month, 15th of the month
  • Billing Period Alignment: Align to Charge
  • Target Date for the Bill Run: 02/14/2018
Example 1

With the above example scenario and the billing rule of assuming 30 days in a month, the total amount is calculated based on the formula:

  • Number of full months: 1 (01/15/2018 - 02/14/2018)
  • Prorated days: 14 days

Total amount on the invoice: $146.67 =  $100 * (1 + 14/30)

Example 2

With the above example scenario and the billing rule of using actual days in a month, the total amount is calculated based on the formula:

  • Number of full months: 1 (01/15/2018 - 02/14/2018)
  • Days in the prorated month: 14 days
  • Actual number of days in the prorated month: 31 days

Total amount on the invoice: $145.16 =  $100 * (1 + 14/31)

Calculating Total Amount with Partial Week Proration

With recurring charges for partial weekly billing periods, the total amount is equal to the sum of prorated amount for partial weeks plus charge amount for full weeks.

The calculation of prorated amount for partial weeks depends on the setting of the Bill recurring charges for partial week (with weekly based billing periods)? billing rule. If this billing rule is set to Yes, the prorated amount is calculated.

You can use the following formula to calculate the total amount:

Charge_amount = Price_per_week* (Number_of_full_weeks + (Prorated_days/7 ) )

Example Scenario:

  • Charge Model: Per Unit Pricing
  • List Price: $100 with the list price base option of Week
  • Billing Period: Week
  • Subscription Term Start Date: 01/01/2018
  • Subscription Term: 5 weeks
  • Billing Day: Specific Day of Week, Wednesday
  • Billing Period Alignment: Align to Charge 
  • Target Date for the Bill Run: 01/31/2018

In this example, the total amount is calculated based on the formula:

  • Price per week: $100
  • Number of full weeks: 5 weeks
  • Prorated days: 2 days (01/01/2018 - 01/02/2018)

Total amount on the invoice: $528.57 = $100 * (5 + 2/7)

Calculating Total Amount with Partial Period (Quarter, Semi-annual, or Annual billing Periods) 

This feature is in Limited Availability. If you wish to have access to the feature, submit a request at Zuora Global Support

With recurring charges for partial quarter, semi-annual, or annual billing periods, the total amount is equal to the sum of the prorated amount for partial billing periods plus charge amount for full billing periods.

The calculation of prorated amount for partial billing periods depends on the setting of the following billing rules:

If Prorate recurring charges for partial period?  is set to Yes, the prorated amount is calculated. The results of the proration depend on the combination of the When prorating periods greater than a month, prorate by month first, or by day? and When prorating a month, assume 30 days in a month or use actual days? billing rules. 

The following table provides you the formulas and examples of the total amount calculation with different bill rules.

  When prorating a month, assume 30 days in a month When prorating a month, use actual days
When prorating periods greater than a month, prorate by month

(If Bill recurring charges for partial month (with monthly based billing periods)? billing rule is set to Yes)

Total_amount = Price_per_month * (Number_of_full_months + (Prorated_days/30) )

Example 1

Total_amount = Price_per_month * (Number_of_full_months + (Prorated_days/Actual_number_of_days_of_prorated_month) )

Example 2

When prorating periods greater than a month, prorate by day

Total_amount = Price_per_billing_period * (Number_of_full_billing_periods + Prorated_days/Number_of_days_of_prorated_period)

Use 30 days to calculate Number_of_days_of_prorated_period. For example:

  • Quarter: 90 days (= 30 *3)
  • Semi-annual: 180 days (= 30 * 6)
  • Annual: 360 days (= 30 * 12)

Example 3

Total_amount = Price_per_billing_period * (Number_of_full_billing_periodsProrated_days/Actual_number_of_days_of_prorated_period)

Example 4

Example Scenario:

  • Charge Model: Per Unit Pricing
  • List Price: $1200 with the list price base option of Billing Period
  • Unit: 1
  • Billing Period: Annual
  • Subscription Term Start Date: 01/01/2018
  • Subscription Term: 12 months
  • Trigger Condition: Upon a Specific Date 07/14/2018
  • End Date: Align to Subscription End Date 
  • Billing Day: Subscription Start Day
  • Billing Period Alignment: Align to Term Start 
  • Target Date for the Bill Run: 12/31/2018
Example 1

With the above example scenario and the following billing rules:

  • Assuming 30 days in a month
  • Prorated by month when prorating periods greater than a month

The total amount is calculated based on the formula:

  • Price per month: $1200/12
  • Number of full months: 5 months (August, September, October, November, and December)
  • Prorated days: 14 days (July 14 - July 31)

Total amount on the invoice: $560.00 =  $1200/12 * (5 + 18/30)

Example 2

With the above example scenario and the following billing rules:

  • Using actual days in a month
  • Prorated by month when prorating periods greater than a month

The total amount is calculated based on the formula:

  • Price per month: $1200/12
  • Number of full months: 5 months (August, September, October, November, and December)
  • Prorated days: 18 days (July 14 - July 31)
  • Actual number of days of the prorated month: 31 days

Total amount on the invoice: $558.06 =  $1200/12 * (5 + 18/31)

Example 3

With the above example scenario and the following billing rules:

  • Assuming 30 days in a month
  • Prorated by day when prorating periods greater than a month

The total amount is calculated based on the formula:

  • Price per billing period: $1200
  • Number of full billing period: 0 year
  • Prorated days: 171 days
  • Number of days of the full period: 360 days

Total amount on the invoice: $570.00 = $1200 * (171/360)

Example 4

With the above example scenario and the following billing rules:

  • Using actual days in a month
  • Prorated by day when prorating periods greater than a month

The total amount is calculated based on the formula:

  • Price per billing period: $1200
  • Number of full billing period: 0 year
  • Total number of days of the partial period: 171 days
  • Actual number of days of the full period: 365 days

Total amount on the invoice: $562.19 = $1200 * (171/365)

See Billing Period Alignment for more information about charge calculation with different billing period alignments.

Last modified
15:02, 29 Dec 2016

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