# Proration

## Overview

Proration is how Aria determines charges or credits that should apply when a customer subscribes to a new plan, cancels a plan, or changes plans in the middle of a billing cycle.

There are several proration settings to determine how the system behaves in regards to proration.

## How Proration Works

To determine prorated charges or credits, Aria calculates the daily cost of a plan's charges based on the number of days in the current billing cycle, then multiplies the daily cost by the applicable number of days remaining in the billing cycle.

For example, for Plan A that costs \$30/month, the daily cost would be \$1 a day for a 30-day period. For Plan B that costs \$60/month, the daily charge would be \$2 a day for a 30-day period.

As a result, if a customer who is billed on the 15th of every month switched from Plan A to Plan B on 4/27/15, that customer would have already consumed \$12 in charges and would be owed an \$18 credit for Plan A. In addition, the customer would owe \$36 for Plan B. The end result, with full proration, would be an \$18 balance (\$36 charge - \$18 credit). The customer will be charged the full amount of \$60 for Plan B on their next billing date (5/15/15).