Calculate cost volume profit by entering retail price, units, total costs, and profit to find the missing business value using three known values.
Cost Volume Profit Formula
The cost volume profit calculation in this calculator is based on sales revenue minus total costs. Sales revenue is retail price multiplied by the number of units sold.
Profit = (P * Q) - TC
- Profit = cost volume profit in dollars
- P = retail price per unit in dollars
- Q = number of units sold
- TC = total costs, including fixed costs plus variable costs
If you leave profit blank, the calculator uses the formula above to find the profit from the retail price, number of units, and total costs.
P = (Profit + TC) / Q
- P = retail price per unit
- Profit = target or known profit
- TC = total fixed and variable costs
- Q = number of units
If you leave retail price blank, the calculator solves for the price needed to cover total costs and reach the entered profit.
Q = (Profit + TC) / P
- Q = number of units
- Profit = target or known profit
- TC = total costs
- P = retail price per unit
If you leave number of units blank, the calculator finds how many units are needed for the given price, total costs, and profit.
TC = (P * Q) - Profit
- TC = total costs
- P = retail price per unit
- Q = number of units
- Profit = cost volume profit
If you leave total costs blank, the calculator finds the total cost amount implied by the entered retail price, units, and profit.
Cost Volume Profit Result Guide
| Result | Meaning | Basic interpretation |
|---|---|---|
| Positive profit | Revenue is greater than total costs. | The sales volume and price cover costs and leave a surplus. |
| Zero profit | Revenue equals total costs. | This is the break-even point for the entered values. |
| Negative profit | Revenue is less than total costs. | The entered price or unit volume is not enough to cover costs. |
Common Cost Volume Profit Inputs
| Input | What to enter | Common mistake |
|---|---|---|
| Retail Price | The selling price for one unit. | Entering total revenue instead of price per unit. |
| Number of Units | The quantity sold or planned to be sold. | Using dollar sales instead of unit count. |
| Fixed Costs Plus Variable Costs | Total costs for the period or scenario. | Entering only fixed costs and leaving out variable costs. |
| Cost Volume Profit | The profit after total costs are subtracted from sales revenue. | Confusing profit with revenue. |
Cost Volume Profit Examples
Example 1: Calculate profit
You sell 500 units at a retail price of $20 per unit. Total fixed and variable costs are $7,000.
Profit = (20 * 500) - 7000
Profit = 10000 - 7000 = 3000
The cost volume profit is $3,000.
Example 2: Calculate required units
You want a profit of $4,000. Total costs are $11,000, and the retail price is $30 per unit.
Q = (4000 + 11000) / 30
Q = 15000 / 30 = 500
You need to sell 500 units.
Cost Volume Profit Calculator FAQ
What is cost volume profit?
Cost volume profit is the profit that remains after total costs are subtracted from sales revenue. In this calculator, sales revenue equals retail price multiplied by number of units. Total costs should include both fixed costs and variable costs.
Is cost volume profit the same as break-even analysis?
They are closely related, but they are not always the same. Break-even analysis finds the point where profit is zero. Cost volume profit analysis can also calculate positive profit, negative profit, required price, required units, or total costs for a target profit.
Should variable costs be entered per unit or as a total?
Enter total costs in the calculator. The field labeled fixed costs plus variable costs should be the combined dollar amount for the scenario. If you only know variable cost per unit, multiply it by the number of units first, then add fixed costs.
