Calculating the ARP it's done in 2 parts:
First up - the debuffs. These reduce your target's initial armor. For example, if your target has 10k armor and it gets 20% sunder, its armor would be 8k. The debuffs stack additively, so Faerie Fire will stack with sunder, totaling a 25% reduction on the target, taking it to 7.5k armor.
Second, comes the formula GC provided, you grab the armor after the debuff calculation and to that armor you apply the formula (armor + C)/3. Using the same example as before, lets say the target is level 80, so C=15232.5, now calculate (7500 + 15232.5)/3 = 7577.5. This makes the target's armor lower than the result, meaning that each 1% removes 75 armor and you are hitting a 0 armor target on the 100% ARP get. The ArP "buffs" (items, stances and such) stack additively too, meaning that 90% ARP on battle stance for a warrior would mean a 100% ARP final.