Learn how to use pro rata basis to calculate proportionate shares, dividends, rent, valuation and more. Find out the rationale, types and disadvantages of this method with simple examples and formulas. Pro rata is a Latin term that means "in proportion" and is used to allocate or assign value based on a comparison. Learn how pro rata is used in finance, accounting, and everyday life with examples and formulas. What is Pro Rata's Using Benefits? Below are some of the many advantages of using a pro rata: When the exact worth of something is hard to ascertain but can be simply stated in ratio to anything else, pro rata is an extremely effective notion. Part-time workers have much more flexibility since they can design their schedules. If you’ve ever applied for a new job, you’ve most likely seen the phrase ‘pro rata’ used in employer salary descriptions. What does the term mean in this context and others, and how can you calculate values using the pro rata basis? We’ll answer these questions below. What is pro rata? The phrase ‘pro rata’ stems from the Latin term for ‘in proportion’. It’s used to describe the proportional value of a part in comparison to its whole. This doesn’t necessarily mean that ...
