How we calculate MRR/ ARR

How we calculate MRR and ARR

RevLock calculates MRR using the following formula.

MRR = ([Sale Price] / [Duration (days)]) * (365 / 12)
ARR = ([Sale Price] / [Duration (days)]) * 365

First find the [Duration (days)] using [Service Start Date] and [Service End Date].
Calculate the [Daily Selling Price] for the subscription/recurring Item by dividing [Sale Price] by [Duration (days)]
MRR = Daily Selling Price x 365 /12
ARR = Daily Selling Price x 365

See below for some sample calculations that explain different scenarios.

MRR/ARR Active Periods

MRR/ARR active period is established using [Service Start Date] & [Service End Date]. Although it is a pretty straight forward calculation there are some edge cases which needs a closer look. Below we have tried to show several examples (including simple and edge cases) so that our users know exactly how active periods are established.

Updated on: 14/10/2020