The irony of course is that the handful of customers who did choose the yearly plan actually contributed to one of my best months in terms of revenue I'm not a

The irony of course is that the handful of customers who did choose the yearly plan actually contributed to one of my best months in terms of revenue I'm not an accountant, but you should recognize that revenue over the life of the subscription, not all in one month. The revenue you collect from a client signing up for a year's worth of service will have to pay for 12 months of expenses that the client generates, plus a reserve fund to pay for refunds, etc. Take the example of a web hosting reseller with a $20/mo plan or $200/year. Each client costs $10/mo (bandwidth, storage, maintenance, support). If I get a client on the annual plan, I can't count that $200 as "money in the bank" because I'll have to consider that $10/mo in expenses ($120), plus the possibility that he'll request a refund after 3 months. The solution is to collect the $200 now but recognize it in $16.67 monthly increments for the life of the annual subscription.