The term pro rata is a Latin phrase meaning "in proportion." In mathematics and business, a pro rata calculation is used to assign a value to a specific portion of a whole based on its share of the total. This is most commonly used in real estate for rent adjustments, in HR for partial salary payments, and in finance for dividend distributions.
The Pro Rata Calculation Formula
To calculate a prorated amount manually, you use the following formula:
Prorated Amount = (Total Amount / Total Units in Period) × Units Actually Used
Step-by-Step Example
Imagine you are moving into an apartment on the 10th of a 30-day month. The total monthly rent is 1,500. You need to calculate the pro rata rent for the remaining 21 days of the month:
Identify Total Amount: 1,500
Identify Total Units: 30 days
Identify Used Units: 21 days
Calculate: (1,500 / 30) = 50 per day.
Final Result: 50 × 21 = 1,050.
Common Use Cases
Prorated Rent: Adjusting the first or last month's rent based on the move-in/move-out date.
Payroll: Calculating the salary for an employee who starts in the middle of a pay period.
Subscription Services: Refunding a user for the remaining days of a canceled subscription.
Insurance Premiums: Determining the cost of a policy that is only active for a fraction of the year.
function calculateProRata() {
var totalAmount = document.getElementById('totalAmount').value;
var totalUnits = document.getElementById('totalUnits').value;
var actualUnits = document.getElementById('actualUnits').value;
var resultDiv = document.getElementById('proratedResult');
if (totalAmount === "" || totalUnits === "" || actualUnits === "") {
resultDiv.style.display = "block";
resultDiv.style.backgroundColor = "#fdeaea";
resultDiv.innerHTML = "Please fill in all fields.";
return;
}
var totalAmtNum = parseFloat(totalAmount);
var totalUnitsNum = parseFloat(totalUnits);
var actualUnitsNum = parseFloat(actualUnits);
if (totalUnitsNum === 0) {
resultDiv.style.display = "block";
resultDiv.style.backgroundColor = "#fdeaea";
resultDiv.innerHTML = "Total units cannot be zero.";
return;
}
var proratedValue = (totalAmtNum / totalUnitsNum) * actualUnitsNum;
var unitValue = totalAmtNum / totalUnitsNum;
resultDiv.style.display = "block";
resultDiv.style.backgroundColor = "#e8f4fd";
resultDiv.innerHTML = "Prorated Amount: " + proratedValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) +
"Value per unit: " + unitValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + "";
}