Prorating: meaning, definitions and examples
💰
prorating
[ˈprɔːreɪtɪŋ ]
Definition
financial calculation
Prorating refers to the process of allocating or distributing a cost or amount proportionally based on a specific period of time or usage. It is commonly used in finance to divide expenses or earnings among different parties or periods, ensuring that each party pays only for what they have consumed or are entitled to receive.
Synonyms
Examples of usage
- The rent for the apartment was prorated for the days not lived.
- They prorated the utility bill based on each tenant's usage.
- When the project ended early, costs were prorated among the stakeholders.
- The salary was prorated due to an employee's part-time status.
Interesting Facts
Etymology
- The word comes from the Latin 'prorata,' meaning 'in proportion,' emphasizing fairness in distribution.
- It combines 'pro,' meaning 'for,' with 'ratio,' meaning 'a reason or a rule,' highlighting the logical method behind the process.
Finance
- In finance, prorating is commonly used to calculate partial expenses like rent for a short-term lease or share costs for utilities.
- Many companies prorate salaries for employees who start mid-month, ensuring they only receive pay for days worked.
Legal Context
- Prorating often appears in legal agreements to ensure all parties understand their financial responsibilities before committing.
- In cases of divorce, prorating can help divide assets or expenses fairly based on the duration of the marriage.
Education
- Schools may prorate tuition based on the number of courses taken, making education accessible for part-time students.
- Program fees such as sports or extracurricular activities are often prorated, allowing for equal payment according to participation time.
Pop Culture
- Prorating appears in novels and movies focusing on financial themes, illustrating how characters navigate shared expenses.
- Television shows often depict renting scenarios where characters argue over prorated bills, highlighting the importance of fair payment.
Translations
Translations of the word "prorating" in other languages:
🇵🇹 prorrateio
🇮🇳 प्रारंभिक आवंटन
🇩🇪 Prorierung
🇮🇩 pembagian proporsional
🇺🇦 пропорційне розподілення
🇵🇱 prorata
🇯🇵 按分
🇫🇷 prorata
🇪🇸 prorrateo
🇹🇷 paylaştırma
🇰🇷 비례 배분
🇸🇦 تقسيم نسبي
🇨🇿 prorata
🇸🇰 prorata
🇨🇳 按比例分配
🇸🇮 prorata
🇮🇸 prófa
🇰🇿 пропорционалды бөлу
🇬🇪 პრორატა
🇦🇿 prorata
🇲🇽 prorrateo