Prorated Meaning: Definition, Examples, and Translations
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prorated
[หprษหreษชtษชd ]
Definition
finance, calculations
Prorated refers to the process of allocating an amount proportionally based on a specific time period or usage. It is commonly used in financial contexts, such as when calculating expenses, salaries, or insurance premiums. When an amount is prorated, it is divided among the relevant time segments, ensuring that each segment reflects the actual usage or occurrence. This method is particularly useful when dealing with partial periods or when funds are received or expended unevenly.
Synonyms
allocated, apportioned, divided.
Examples of usage
- The rental fee will be prorated for the days you won't be staying.
- You will receive a prorated salary for the month if you start mid-way through.
- The refund was calculated on a prorated basis.
- The company offers a prorated reimbursement for unused leave.
Translations
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Origin of 'prorated'
The term 'prorated' stems from the Latin word 'pro rata,' which means 'in proportion.' The usage of this term has evolved over time, especially in financial and accounting contexts, where it is crucial to ensure that costs or benefits are fairly divided among various periods or participants. The concept of prorating began to gain popularity with the advent of modern accounting practices, as businesses needed a method to accurately reflect income and expenses over fractions of time. It allows for more equitable solutions to financial obligations, especially when timeframes do not align neatly with billing cycles or salary periods. The adaptation of the term into English solidified its place in both legal and commercial terminology in the late 19th to early 20th centuries.