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this example shows us how to find breakage revenue using the proportional method we have given information in the peach box with sales of 1:10 breakage rate of 12% 20 percent of the gift cards have been redeemed in the current period the amount of breakage revenue will start with gift cards that were actually redeemed so that ends up being 22,000 were going to use that as a numerator in our proportion next to get the denominator what we need to do is first find estimated breakage which is 12 percent of the total gift card sales then we take the actual amount of gift card sales subtract out the expected breakage that will give us ninety six thousand eight hundred in the estimated amount of gift cards that will be redeemed so we take our twenty two thousand gift cards redeemed divided by gift cards estimated to be redeemed and that puts us at a little bit more than twenty two percent so we are allowed to cord the revenue of breakage revenue of twenty two point seven three percent of th