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PROFIT
CALCULATOR
INSTRUCTIONS
This calculator is designed to help a business to
determine the point at which a product or service becomes profitable.
It can also be used to calculate total profits from a sales scenario, the optimal
price for the product or service and help a business to assess the
benefits of various business proposals.
Enter your fixed and variable costs for a product or service
together with expected prices and sales volumes.
Click once on the "Calculate" button to
calculate your result.
Click once on the "Full Report" button to
see a detailed breakdown of the calculations.
Close this window to return to the Tools page.
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NOTES
Variable Unit Cost:
Costs that vary directly with the production of one additional unit.
Fixed Cost:
The sum of all costs required to produce the first unit of a product. This amount does not
vary as production increases or decreases.
Expected Unit Sales:
Number of units of the product that are projected to be sold over a specific period of
time.
Price per Unit:
The amount of money charged for each unit of a product or service.
Total Variable Costs:
The product of expected unit sales and variable unit cost.
(Variable Unit Cost x Expected Unit Sales)
Total of all Costs:
The sum of the fixed and total variable costs for any given level of production.
(Total Variable Cost + Fixed Cost)
Total Revenue:
Total product of expected unit sales and price per unit.
(Price x Expected Unit Sales)
Profit (or Loss):
The financial gain (or loss) resulting from revenues after subtracting all associated
costs.
(Total Revenues - Total Costs)
Breakeven:
Number of units required to be sold in order to produce a profit of zero.
(Breakeven = Fixed Cost / (Price per Unit - Variable Unit Cost))
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