When using the Use Actual Days in Billing Period proration calculation, the proportion invoiced for the partial period is based on the exact number of days used out of the full billing period.
The formula used to calculate the prorated value for the partial period is:
Sales Price * (x/y)
where:
- x is the number of days that the contract has been in use, including start and end days, during the partial period
- y is the number of days in the full period
The following examples show how prorated values are calculated when using the Actual Days calculation method.
Example 1
In this example, the billing term WB starts on Monday.
|
Line Start Date |
Line End Date |
Billing Term |
Line Sales Price |
First Billing Period |
Final Billing Period |
|---|---|---|---|---|---|
| Sat, Aug 12, 2017 | Tue, Aug 22, 2017 | WB + 3d | $70 |
Aug 12 to Aug 16 = 5 days Aug 16 - billing term (WB+3d) = Aug 10 Aug 10 to Aug 16 = 7 days $70 * (5/7) = $50 |
Aug 17 to Aug 22 = 6 days Aug 17 + billing term (WB+3d) = Aug 23 Aug 17 to Aug 23 = 7 days $70 * (6/7) = $60 |
Example 2
|
Line Start Date |
Line End Date |
Billing Term |
Line Sales Price |
First Billing Period |
Final Billing Period |
|---|---|---|---|---|---|
| Wed, Aug 2, 2017 | Sat, Sept 9, 2017 | ME - 6d | $930 |
Aug 2 to Aug 24 = 23 days Aug 24 - billing term (ME-6d) = July 25 July 25 to Aug 24 = 31 days $930 * (23/31) = $690 |
Aug 25 to Sept 9 = 16 days Aug 25 + billing term (ME-6d) = Sept 24 Aug 25 to Sept 24 = 31 days $930 * (16/31) = $480 |
Example 3
|
Line Start Date |
Line End Date |
Billing Term |
Line Sales Price |
First Billing Period |
Final Billing Period |
|---|---|---|---|---|---|
| Tues, Aug 8, 2017 | Tues, Oct 31, 2017 | MB + 4d | $930 |
Aug 8 to Sept 4 = 28 days Sept 4 - billing term (MB + 4d) = Aug 5 Aug 5 to Sept 4 = 31 days $930 * (28/31) = $840 |
Oct 5 to Oct 31 = 27 days Oct 5 + billing term (MB + 4d) = 4 Nov Oct 5 to Nov 4 = 31 days $930 * (27/31) = $810 |
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