Contribution Margin Calculator
Calculate contribution margin per unit or in total, and contribution margin ratio. Optional break-even and operating profit.
Use the Contribution Margin Calculator
Enter price and variable cost (per unit) or total revenue and variable costs. Optionally add fixed costs for break-even.
Sales & costs
Per-unit or total revenue and variable costs.
Results
Contribution margin per unit
$20
Contribution margin ratio
40%
Contribution margin = Revenue − Variable costs. It’s what’s left to cover fixed costs and profit.
What this metric means
Contribution margin shows how much each sale (or each dollar of revenue) contributes after variable costs. It’s central to break-even and pricing.
How to improve
Raise price or lower variable cost per unit. Improve product mix toward higher-margin items if you have multiple products.
FAQs
What is contribution margin?▾
Contribution margin is revenue minus variable costs. It’s what’s left to cover fixed costs and profit. Per unit: price minus variable cost per unit.
What is the contribution margin ratio?▾
Contribution margin as a % of revenue. Ratio = (Revenue − Variable costs) ÷ Revenue × 100. Higher ratio means more of each dollar contributes to fixed costs and profit.
When do I use per-unit vs totals?▾
Use per-unit when you have a single product or an average. Use totals when you have aggregate revenue and variable costs (e.g. from the P&L).
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