Accrual vs cash

A refund happens on a different day from the sale it reverses, so any report covering a date range has to choose which day to count it against. Both answers are correct for different questions, so the product does not pick for you — the reports carry a toggle.

Accrual keeps an order whole: everything it ever earns or gives back is dated to the day it sold, so a product's true lifetime performance is legible. Cash follows the money as it moves, so a period matches what actually hit your account. Use accrual to judge a product, cash to reconcile a month.

Refunds on the order's day

A refund counts against the day its order sold — a shirt sold Aug 20 and refunded Sep 10 shows $0 on Aug 20.

Refunds on the day they happened

A refund counts on the day it landed — that same shirt shows the sale on Aug 20 and the refund on Sep 10.

The two views of one period will disagree whenever refunds cross its boundary, and neither is wrong. If a month looks unexpectedly bad on cash basis, check whether it absorbed refunds for a strong month before it.