> ## Documentation Index
> Fetch the complete documentation index at: https://docs.tangoanalytics.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Proration methods

> Reference for how partial-period payments are calculated in Tango.

When a recurring cost's effective date starts or ends mid-month, Tango uses a proration method to calculate the partial-period amount. The proration method is set on each recurring cost record.

## Available proration methods

| Method | Description | Formula |
| - | - | - |
| Days in Month | Divides by the actual number of calendar days in the month | Period Amount ÷ Days in Month × Days Occupied |
| Days in Year / 12 | Uses a standardized month of Annual Amount ÷ 12 ÷ 365 | Annual Amount ÷ 365 × Days Occupied |
| Days in Year / 360 | Uses a 360-day year convention | Annual Amount ÷ 360 × Days Occupied |
| None | No proration; the full period amount is charged regardless of partial occupancy | Full Period Amount |
| Equal Monthly | Distributes the annual amount equally across 12 months | Annual Amount ÷ 12 |

## CPI proration considerations

When a CPI adjustment is retroactive (effective before the last processed payment), Tango calculates a catch-up amount. The proration method on the recurring cost controls how the catch-up is computed for any partial periods in the retroactive window.

The catch-up amount is presented in the **Calculate Adjustment** pop-up before you apply the change, so you can verify it before committing.

## Billing proration

For receivable leases, the same proration methods apply to billings. Prorated billings reflect the tenant's actual days of occupancy in a partial period.

## How to set the proration method

The **Prorate Method** field is on each recurring cost record in **Lease Details → Recurring Costs**. Set it when creating the recurring cost or update it at any time (changes apply to future generated payments).

<Note>Changes to the proration method on an existing recurring cost do not retroactively change already-generated payment records.</Note>

## CPI index calculation reference

When a CPI adjustment is calculated, the actual increase percentage follows this formula:

```
Actual Increase % = ((Current Index - Previous Index) / Previous Index) × Index Multiplier
```

The result is then constrained by the Floor Increase % and Ceiling Increase % if those fields are populated.

The new period amount is:

```
New Period Amount = Original Period Amount × (1 + Actual Increase %)
```