🎯Cost-Volume-Profit (CVP) Analysis
Contribution Margin Ratio
Contribution Margin ÷ Sales × 100 = CM Ratio %
What It Means
Percentage of each sales dollar available for fixed costs and profit.
Example
Contribution Margin:$40
Sales Price:$100
$40 ÷ $100 × 100
CM Ratio = 40%
Related Formulas
Contribution Margin per Unit
Sales Price per Unit - Variable Cost per Unit = Contribution Margin per Unit
Break-Even Point in Units
Fixed Costs ÷ Contribution Margin per Unit = Break-Even Units
Break-Even Point in Sales Dollars
Fixed Costs ÷ Contribution Margin Ratio = Break-Even Sales $
Target Profit (Units)
(Fixed Costs + Target Profit) ÷ Contribution Margin per Unit = Units Needed
Want all 70+ formulas in one place?
← Back to Full Cheatsheet