diff --git a/bun.lock b/bun.lock
index 7f1546b..14c066b 100644
--- a/bun.lock
+++ b/bun.lock
@@ -31,6 +31,9 @@
     },
     "packages/application": {
       "name": "@household/application",
+      "dependencies": {
+        "@household/domain": "workspace:*",
+      },
     },
     "packages/config": {
       "name": "@household/config",
diff --git a/docs/specs/HOUSEBOT-011-monthly-settlement-engine.md b/docs/specs/HOUSEBOT-011-monthly-settlement-engine.md
new file mode 100644
index 0000000..67c802f
--- /dev/null
+++ b/docs/specs/HOUSEBOT-011-monthly-settlement-engine.md
@@ -0,0 +1,80 @@
+# HOUSEBOT-011: Monthly Settlement Engine
+
+## Summary
+
+Implement a deterministic monthly settlement use-case that computes per-member dues from rent, utilities, and shared purchases.
+
+## Goals
+
+- Compute per-member net due amounts deterministically.
+- Support utility split modes: equal and weighted-by-days.
+- Model purchase offsets where payer reimbursement reduces their due.
+
+## Non-goals
+
+- Persistence adapters.
+- Telegram command handlers.
+
+## Scope
+
+- In: pure settlement use-case logic and tests.
+- Out: DB writes, HTTP/bot integration.
+
+## Interfaces and Contracts
+
+- Input: `SettlementInput` from `@household/domain`.
+- Output: `SettlementResult` with per-member line breakdown.
+- Entry point: `calculateMonthlySettlement(input)` in application package.
+
+## Domain Rules
+
+- Use integer minor units only via `Money` value object.
+- Rent is split evenly among active members.
+- Utility split:
+  - `equal`: evenly among active members.
+  - `weighted_by_days`: proportional to `utilityDays` for each active member.
+- Purchase offset per member:
+  - `purchaseSharedCost - purchasePaid`
+- Net due:
+  - `rentShare + utilityShare + purchaseOffset`
+
+## Data Model Changes
+
+- None.
+
+## Security and Privacy
+
+- No PII required in settlement computation.
+- Uses internal typed member IDs only.
+
+## Observability
+
+- Explanations list on each line provides deterministic calculation fragments.
+
+## Edge Cases and Failure Modes
+
+- No active members.
+- Weighted utility split with invalid or missing day values.
+- Purchase payer not in active members.
+- Negative monetary inputs.
+- Currency mismatch across input values.
+
+## Test Plan
+
+- Unit:
+  - 3-member equal split with purchase offset.
+  - 4-member weighted utility split.
+  - 5-member deterministic fixture with multiple purchases.
+  - Invalid weighted utility day input.
+  - Invalid purchase payer.
+
+## Acceptance Criteria
+
+- [ ] Equal utility split default implemented.
+- [ ] Day-based utility split implemented.
+- [ ] Deterministic fixtures for 3-5 roommate scenarios.
+- [ ] Explicit errors for invalid settlement inputs.
+
+## Rollout Plan
+
+- Merge as dependency for bot command handlers and statement generation flow.
diff --git a/packages/application/package.json b/packages/application/package.json
index eeb9b79..90013ef 100644
--- a/packages/application/package.json
+++ b/packages/application/package.json
@@ -2,10 +2,16 @@
   "name": "@household/application",
   "private": true,
   "type": "module",
+  "exports": {
+    ".": "./src/index.ts"
+  },
   "scripts": {
     "build": "bun build src/index.ts --outdir dist --target bun",
     "typecheck": "tsgo --project tsconfig.json --noEmit",
     "test": "bun test --pass-with-no-tests",
     "lint": "oxlint \"src\""
+  },
+  "dependencies": {
+    "@household/domain": "workspace:*"
   }
 }
diff --git a/packages/application/src/index.ts b/packages/application/src/index.ts
index 771ecaa..944e7de 100644
--- a/packages/application/src/index.ts
+++ b/packages/application/src/index.ts
@@ -1 +1 @@
-export const applicationReady = true
+export { calculateMonthlySettlement } from './settlement-engine'
diff --git a/packages/application/src/settlement-engine.test.ts b/packages/application/src/settlement-engine.test.ts
new file mode 100644
index 0000000..c0c672e
--- /dev/null
+++ b/packages/application/src/settlement-engine.test.ts
@@ -0,0 +1,153 @@
+import { describe, expect, test } from 'bun:test'
+
+import {
+  BillingCycleId,
+  BillingPeriod,
+  DomainError,
+  MemberId,
+  Money,
+  PurchaseEntryId
+} from '@household/domain'
+
+import { calculateMonthlySettlement } from './settlement-engine'
+
+function fixtureBase() {
+  return {
+    cycleId: BillingCycleId.from('cycle-2026-03'),
+    period: BillingPeriod.fromString('2026-03'),
+    rent: Money.fromMajor('700.00', 'USD'),
+    utilities: Money.fromMajor('120.00', 'USD')
+  }
+}
+
+describe('calculateMonthlySettlement', () => {
+  test('3-member equal split with purchase offsets', () => {
+    const input = {
+      ...fixtureBase(),
+      utilitySplitMode: 'equal' as const,
+      members: [
+        { memberId: MemberId.from('alice'), active: true },
+        { memberId: MemberId.from('bob'), active: true },
+        { memberId: MemberId.from('carol'), active: true }
+      ],
+      purchases: [
+        {
+          purchaseId: PurchaseEntryId.from('p1'),
+          payerId: MemberId.from('alice'),
+          amount: Money.fromMajor('30.00', 'USD')
+        }
+      ]
+    }
+
+    const result = calculateMonthlySettlement(input)
+
+    expect(result.lines.map((line) => line.memberId.toString())).toEqual(['alice', 'bob', 'carol'])
+    expect(result.lines.map((line) => line.rentShare.amountMinor)).toEqual([23334n, 23333n, 23333n])
+    expect(result.lines.map((line) => line.utilityShare.amountMinor)).toEqual([4000n, 4000n, 4000n])
+    expect(result.lines.map((line) => line.purchaseOffset.amountMinor)).toEqual([
+      -2000n,
+      1000n,
+      1000n
+    ])
+    expect(result.lines.map((line) => line.netDue.amountMinor)).toEqual([25334n, 28333n, 28333n])
+    expect(result.totalDue.amountMinor).toBe(82000n)
+  })
+
+  test('4-member weighted utility split by days', () => {
+    const input = {
+      ...fixtureBase(),
+      utilitySplitMode: 'weighted_by_days' as const,
+      members: [
+        { memberId: MemberId.from('a'), active: true, utilityDays: 31 },
+        { memberId: MemberId.from('b'), active: true, utilityDays: 31 },
+        { memberId: MemberId.from('c'), active: true, utilityDays: 20 },
+        { memberId: MemberId.from('d'), active: true, utilityDays: 10 }
+      ],
+      purchases: []
+    }
+
+    const result = calculateMonthlySettlement(input)
+
+    expect(result.lines.map((line) => line.utilityShare.amountMinor)).toEqual([
+      4044n,
+      4043n,
+      2609n,
+      1304n
+    ])
+    expect(result.lines.map((line) => line.rentShare.amountMinor)).toEqual([
+      17500n,
+      17500n,
+      17500n,
+      17500n
+    ])
+    expect(result.totalDue.amountMinor).toBe(82000n)
+  })
+
+  test('5-member scenario with two purchases remains deterministic', () => {
+    const input = {
+      ...fixtureBase(),
+      utilitySplitMode: 'equal' as const,
+      members: [
+        { memberId: MemberId.from('m1'), active: true },
+        { memberId: MemberId.from('m2'), active: true },
+        { memberId: MemberId.from('m3'), active: true },
+        { memberId: MemberId.from('m4'), active: true },
+        { memberId: MemberId.from('m5'), active: true }
+      ],
+      purchases: [
+        {
+          purchaseId: PurchaseEntryId.from('p1'),
+          payerId: MemberId.from('m1'),
+          amount: Money.fromMajor('25.00', 'USD')
+        },
+        {
+          purchaseId: PurchaseEntryId.from('p2'),
+          payerId: MemberId.from('m4'),
+          amount: Money.fromMajor('41.00', 'USD')
+        }
+      ]
+    }
+
+    const result = calculateMonthlySettlement(input)
+
+    expect(result.lines.map((line) => line.netDue.amountMinor)).toEqual([
+      15220n,
+      17720n,
+      17720n,
+      13620n,
+      17720n
+    ])
+    expect(result.totalDue.amountMinor).toBe(82000n)
+  })
+
+  test('throws if weighted split is selected without valid utility days', () => {
+    const input = {
+      ...fixtureBase(),
+      utilitySplitMode: 'weighted_by_days' as const,
+      members: [
+        { memberId: MemberId.from('a'), active: true, utilityDays: 31 },
+        { memberId: MemberId.from('b'), active: true }
+      ],
+      purchases: []
+    }
+
+    expect(() => calculateMonthlySettlement(input)).toThrow(DomainError)
+  })
+
+  test('throws if purchase payer is not active', () => {
+    const input = {
+      ...fixtureBase(),
+      utilitySplitMode: 'equal' as const,
+      members: [{ memberId: MemberId.from('a'), active: true }],
+      purchases: [
+        {
+          purchaseId: PurchaseEntryId.from('p1'),
+          payerId: MemberId.from('ghost'),
+          amount: Money.fromMajor('10.00', 'USD')
+        }
+      ]
+    }
+
+    expect(() => calculateMonthlySettlement(input)).toThrow(DomainError)
+  })
+})
diff --git a/packages/application/src/settlement-engine.ts b/packages/application/src/settlement-engine.ts
new file mode 100644
index 0000000..d93d39e
--- /dev/null
+++ b/packages/application/src/settlement-engine.ts
@@ -0,0 +1,205 @@
+import {
+  DOMAIN_ERROR_CODE,
+  DomainError,
+  Money,
+  type SettlementInput,
+  type SettlementMemberInput,
+  type SettlementMemberLine,
+  type SettlementResult
+} from '@household/domain'
+
+interface ComputationMember {
+  input: SettlementMemberInput
+  rentShare: Money
+  utilityShare: Money
+  purchaseSharedCost: Money
+  purchasePaid: Money
+}
+
+function createMemberState(
+  input: SettlementMemberInput,
+  currency: 'GEL' | 'USD'
+): ComputationMember {
+  return {
+    input,
+    rentShare: Money.zero(currency),
+    utilityShare: Money.zero(currency),
+    purchaseSharedCost: Money.zero(currency),
+    purchasePaid: Money.zero(currency)
+  }
+}
+
+function ensureActiveMembers(
+  members: readonly SettlementMemberInput[]
+): readonly SettlementMemberInput[] {
+  const active = members.filter((member) => member.active)
+
+  if (active.length === 0) {
+    throw new DomainError(
+      DOMAIN_ERROR_CODE.INVALID_SETTLEMENT_INPUT,
+      'Settlement must include at least one active member'
+    )
+  }
+
+  return active
+}
+
+function ensureNonNegativeMoney(label: string, value: Money): void {
+  if (value.isNegative()) {
+    throw new DomainError(
+      DOMAIN_ERROR_CODE.INVALID_SETTLEMENT_INPUT,
+      `${label} must be non-negative`
+    )
+  }
+}
+
+function sumMoney(values: readonly Money[], currency: 'GEL' | 'USD'): Money {
+  return values.reduce((sum, current) => sum.add(current), Money.zero(currency))
+}
+
+function validateWeightedUtilityDays(members: readonly SettlementMemberInput[]): readonly bigint[] {
+  const weights = members.map((member) => {
+    const days = member.utilityDays
+
+    if (days === undefined || !Number.isInteger(days) || days <= 0) {
+      throw new DomainError(
+        DOMAIN_ERROR_CODE.INVALID_SETTLEMENT_INPUT,
+        `utilityDays must be a positive integer for member ${member.memberId.toString()}`
+      )
+    }
+
+    return BigInt(days)
+  })
+
+  const total = weights.reduce((sum, current) => sum + current, 0n)
+  if (total <= 0n) {
+    throw new DomainError(
+      DOMAIN_ERROR_CODE.INVALID_SETTLEMENT_INPUT,
+      'Total utility day weights must be positive'
+    )
+  }
+
+  return weights
+}
+
+function validateCurrencyConsistency(input: SettlementInput): void {
+  const currency = input.rent.currency
+
+  if (input.utilities.currency !== currency) {
+    throw new DomainError(
+      DOMAIN_ERROR_CODE.CURRENCY_MISMATCH,
+      `Money operation currency mismatch: ${currency} vs ${input.utilities.currency}`
+    )
+  }
+
+  for (const purchase of input.purchases) {
+    if (purchase.amount.currency !== currency) {
+      throw new DomainError(
+        DOMAIN_ERROR_CODE.CURRENCY_MISMATCH,
+        `Money operation currency mismatch: ${currency} vs ${purchase.amount.currency}`
+      )
+    }
+  }
+}
+
+export function calculateMonthlySettlement(input: SettlementInput): SettlementResult {
+  validateCurrencyConsistency(input)
+  ensureNonNegativeMoney('Rent', input.rent)
+  ensureNonNegativeMoney('Utilities', input.utilities)
+
+  const currency = input.rent.currency
+  const activeMembers = ensureActiveMembers(input.members)
+
+  const membersById = new Map<string, ComputationMember>(
+    activeMembers.map((member) => [member.memberId.toString(), createMemberState(member, currency)])
+  )
+
+  const rentShares = input.rent.splitEvenly(activeMembers.length)
+  for (const [index, member] of activeMembers.entries()) {
+    const state = membersById.get(member.memberId.toString())
+    if (!state) {
+      continue
+    }
+
+    state.rentShare = rentShares[index] ?? Money.zero(currency)
+  }
+
+  const utilityShares =
+    input.utilitySplitMode === 'equal'
+      ? input.utilities.splitEvenly(activeMembers.length)
+      : input.utilities.splitByWeights(validateWeightedUtilityDays(activeMembers))
+
+  for (const [index, member] of activeMembers.entries()) {
+    const state = membersById.get(member.memberId.toString())
+    if (!state) {
+      continue
+    }
+
+    state.utilityShare = utilityShares[index] ?? Money.zero(currency)
+  }
+
+  for (const purchase of input.purchases) {
+    ensureNonNegativeMoney('Purchase amount', purchase.amount)
+
+    const payer = membersById.get(purchase.payerId.toString())
+    if (!payer) {
+      throw new DomainError(
+        DOMAIN_ERROR_CODE.INVALID_SETTLEMENT_INPUT,
+        `Purchase payer is not an active member: ${purchase.payerId.toString()}`
+      )
+    }
+
+    payer.purchasePaid = payer.purchasePaid.add(purchase.amount)
+
+    const purchaseShares = purchase.amount.splitEvenly(activeMembers.length)
+    for (const [index, member] of activeMembers.entries()) {
+      const state = membersById.get(member.memberId.toString())
+      if (!state) {
+        continue
+      }
+
+      state.purchaseSharedCost = state.purchaseSharedCost.add(
+        purchaseShares[index] ?? Money.zero(currency)
+      )
+    }
+  }
+
+  const lines: SettlementMemberLine[] = activeMembers.map((member) => {
+    const state = membersById.get(member.memberId.toString())
+    if (!state) {
+      throw new DomainError(
+        DOMAIN_ERROR_CODE.INVALID_SETTLEMENT_INPUT,
+        `Missing member state: ${member.memberId.toString()}`
+      )
+    }
+
+    const purchaseOffset = state.purchaseSharedCost.subtract(state.purchasePaid)
+    const netDue = state.rentShare.add(state.utilityShare).add(purchaseOffset)
+
+    return {
+      memberId: member.memberId,
+      rentShare: state.rentShare,
+      utilityShare: state.utilityShare,
+      purchaseOffset,
+      netDue,
+      explanations: [
+        `rent_share_minor=${state.rentShare.amountMinor.toString()}`,
+        `utility_share_minor=${state.utilityShare.amountMinor.toString()}`,
+        `purchase_paid_minor=${state.purchasePaid.amountMinor.toString()}`,
+        `purchase_shared_minor=${state.purchaseSharedCost.amountMinor.toString()}`
+      ]
+    }
+  })
+
+  const totalDue = sumMoney(
+    lines.map((line) => line.netDue),
+    currency
+  )
+
+  return {
+    cycleId: input.cycleId,
+    period: input.period,
+    lines,
+    totalDue
+  }
+}
diff --git a/packages/domain/package.json b/packages/domain/package.json
index b52ee49..1e0af89 100644
--- a/packages/domain/package.json
+++ b/packages/domain/package.json
@@ -2,6 +2,9 @@
   "name": "@household/domain",
   "private": true,
   "type": "module",
+  "exports": {
+    ".": "./src/index.ts"
+  },
   "scripts": {
     "build": "bun build src/index.ts --outdir dist --target bun",
     "typecheck": "tsgo --project tsconfig.json --noEmit",
diff --git a/packages/domain/src/errors.ts b/packages/domain/src/errors.ts
index 716c202..2d771bc 100644
--- a/packages/domain/src/errors.ts
+++ b/packages/domain/src/errors.ts
@@ -15,5 +15,6 @@ export const DOMAIN_ERROR_CODE = {
   INVALID_SPLIT_PARTS: 'INVALID_SPLIT_PARTS',
   INVALID_SPLIT_WEIGHTS: 'INVALID_SPLIT_WEIGHTS',
   INVALID_BILLING_PERIOD: 'INVALID_BILLING_PERIOD',
-  INVALID_ENTITY_ID: 'INVALID_ENTITY_ID'
+  INVALID_ENTITY_ID: 'INVALID_ENTITY_ID',
+  INVALID_SETTLEMENT_INPUT: 'INVALID_SETTLEMENT_INPUT'
 } as const