What is the difference between compensation and refund?

In Merchant Center, refunds can be created in two ways: per order row or as a single sum on an order.

Refund:

• A refund is created when processing a return for a specific order row (e.g., via WMS > Handle Returns).
• If an amount is set to be refunded during this process, it will appear in the Refunds and Refunds Amount columns in the Sales Demand and Revenue views.
  
  

Compensation:

• A compensation is issued when a refund is made as a single sum on an order, without being tied to a specific product or order row.
• Compensation amounts are displayed in the Compensation column in the Sales Demand and Revenue views
  
  

Example of compensation and refunds data in a statistcs view in Merchant Center: