Business
Contribution Margin Calculator
Find how much each sale contributes toward fixed costs and profit after variable costs.
Result
Every cost must be classified as either fixed or variable, and some are genuinely mixed. Put semi-variable costs like fuel with variable, and anything you owe regardless of volume with fixed.
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About this calculator
How is this different from gross margin?
Gross margin subtracts all cost of goods sold, some of which is fixed. Contribution margin subtracts only costs that change with volume, which is what you need for break-even and pricing decisions.
Why does contribution margin matter for quoting?
When you have spare capacity, any job with a positive contribution adds to profit even if it looks under-priced on full costing. The fixed costs are being paid either way.
The formula
contribution margin = price − variable cost per unit
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