Accounting Annual Recurring Revenue (Per-Unit) Calculator Examples
See worked ARR per-unit examples for monthly, quarterly, annual, and discounted recurring unit pricing.
These examples show how recurring price, billing frequency, active units, and recurring discounts affect ARR per unit and total ARR. They use annualized recurring revenue estimates rather than recognized revenue.
Monthly subscription with no discount
A business bills 25 active units at $80 per month without a recurring discount.
Input Summary
Recurring price per unit
$80 per month
Billing periods per year
12
Active recurring units
25 units
Average discount rate
0%
Calculation Breakdown
- 1Net monthly unit price80 × (1 - 0 / 100)$80
- 2ARR per unit80 × 12$960 per year
- 3Total ARR960 × 25$24,000 per year
Result Summary
Total ARR
$24,000 per year
Accounting Annual Recurring Revenue (Per-Unit) Calculator
Estimated ARR is $960 per unit and $24,000 in total per year.
Quarterly recurring units with an average discount
A service charges $300 per unit each quarter, has 60 active units, and applies a 15% average recurring discount.
Input Summary
Recurring price per unit
$300 per quarter
Billing periods per year
4
Active recurring units
60 units
Average discount rate
15%
Calculation Breakdown
- 1Net quarterly unit price300 × (1 - 15 / 100)$255
- 2ARR per unit255 × 4$1,020 per year
- 3Total ARR1,020 × 60$61,200 per year
- 4Annual discount value300 × 4 × 60 - 61,200$10,800 per year
Result Summary
Total ARR
$61,200 per year
Accounting Annual Recurring Revenue (Per-Unit) Calculator
Estimated ARR is $1,020 per unit and $61,200 in total per year.
Annual plan with a larger active-unit base
A company charges $1,200 annually per unit and has 500 active units with a 5% average recurring discount.
Input Summary
Recurring price per unit
$1,200 per year
Billing periods per year
1
Active recurring units
500 units
Average discount rate
5%
Calculation Breakdown
- 1Net annual unit price1,200 × (1 - 5 / 100)$1,140
- 2ARR per unit1,140 × 1$1,140 per year
- 3Total ARR1,140 × 500$570,000 per year
- 4Annual discount value1,200 × 1 × 500 - 570,000$30,000 per year
Result Summary
Total ARR
$570,000 per year
Accounting Annual Recurring Revenue (Per-Unit) Calculator
Estimated ARR is $1,140 per unit and $570,000 in total per year.
Low-price monthly units with a high discount
A platform charges $18 per month for 1,200 active units and has a 25% average recurring discount.
Input Summary
Recurring price per unit
$18 per month
Billing periods per year
12
Active recurring units
1,200 units
Average discount rate
25%
Calculation Breakdown
- 1Net monthly unit price18 × (1 - 25 / 100)$13.50
- 2ARR per unit13.50 × 12$162 per year
- 3Total ARR162 × 1,200$194,400 per year
- 4Annual discount value18 × 12 × 1,200 - 194,400$64,800 per year
Result Summary
Total ARR
$194,400 per year
Accounting Annual Recurring Revenue (Per-Unit) Calculator
Estimated ARR is $162 per unit and $194,400 in total per year.
How to Read Your Results
ARR per unit is the annualized recurring value of one active unit after the average discount.
Total ARR is ARR per unit multiplied by the active recurring-unit count.
Net recurring unit price shows the amount used for each billing period after discount.
Annual discount value compares discounted ARR with the annualized recurring revenue at list price.
A result is a current recurring run-rate estimate, not a forecast of cash collected or recognized revenue.
Assumptions & Important Notes
- All units shown in each example remain active for a full annualized period.
- The entered discount applies to ongoing recurring charges.
- No new units, cancellations, refunds, price changes, or billing-frequency changes occur during the period.
- Non-recurring charges and taxes are excluded.
Related Examples
Frequently Asked Questions
Can I use these examples for monthly and quarterly subscriptions?
Yes. Set billing periods per year to match the entered unit price: 12 for monthly and 4 for quarterly pricing.
Why does annual billing use one billing period per year?
The annual unit price already covers a full year, so multiplying it by more than one would overstate ARR.
What does total ARR show in these examples?
It shows the annualized recurring revenue across the active units after the stated average discount.
Can an average discount be zero?
Yes. Use 0% when active units pay the listed recurring price with no ongoing discount.
Are the examples revenue-recognition schedules?
No. They demonstrate annualized recurring revenue calculations, which can differ from recognized revenue timing.
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