Accounting Average Order Value (Monthly) Calculator FAQ
Answers to common questions about calculating monthly net average order value, net sales, completed orders, discounts, and refunds.
This FAQ explains what the monthly accounting AOV calculator measures, which figures to include, and how to interpret the result. It is intended for general educational use and provides estimates based on the figures entered.
General monthly AOV questions
Basic definitions and typical uses of monthly average order value.
What is monthly average order value?
Monthly average order value is the average revenue associated with each completed order during a month. This calculator reports net AOV using net sales.
What does this calculator measure?
It estimates net revenue per completed order after subtracting sales discounts, refunds, and allowances from gross sales.
Why is AOV useful to track monthly?
It provides a consistent way to review how much revenue is generated per completed order and how sales adjustments affect that amount.
Is average order value the same as profit per order?
No. AOV measures revenue per order. Profit per order also requires costs such as inventory, labor, shipping, fees, and overhead.
Sales and order inputs
Questions about the figures included in the calculation.
What should be included in gross sales?
Use total monthly sales before the discounts, refunds, and allowances entered separately in the calculator.
Should cancelled orders be counted?
Usually not. Use completed orders that correspond to the sales revenue included for the same reporting period.
Should returned orders remain in completed orders?
Use a consistent method. If return-related refunds are deducted from sales, ensure the completed-order count is treated consistently across periods.
Should taxes be included in gross sales?
That depends on the reporting purpose and accounting treatment. Apply the same treatment consistently to every comparison period.
Can shipping income be included?
It can be included if it is part of the sales measure used internally, but it should be handled consistently across months.
Formula and results
How the calculator derives net sales, AOV, gross AOV, and the adjustment rate.
How is net sales calculated?
Net sales equals gross sales minus sales discounts minus refunds and allowances.
How is net AOV calculated?
Net AOV equals net sales divided by completed orders.
What is gross average order value?
Gross AOV equals gross sales divided by completed orders, before discounts, refunds, and allowances are deducted.
What is the sales adjustment rate?
It is total sales discounts plus refunds and allowances, divided by gross sales, expressed as a percentage.
Why is net AOV lower than gross AOV?
Net AOV is lower when discounts, refunds, returns, credits, or allowances reduce gross sales.
Accuracy and interpretation
Important consistency checks and boundaries of the estimate.
How accurate is the monthly AOV calculation?
The arithmetic is direct, but usefulness depends on accurate records and consistent treatment of revenue, adjustments, and orders.
Can the sales adjustment rate exceed 100%?
Yes, if discounts, refunds, and allowances recorded in the month exceed gross sales recorded in that month. This may reflect timing differences or unusual adjustments.
Why might AOV change even if sales are flat?
AOV can change when the completed-order count changes, when discounts or refunds change, or when the mix of orders changes.
Can I use this result to compare different sales channels?
Yes, if each channel uses comparable definitions of gross sales, adjustments, and completed orders.
What is the formula for monthly net AOV?
Monthly net AOV = (gross sales − sales discounts − refunds and allowances) ÷ completed orders.
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