The Business Calc

Target Profit Calculator

Units needed = (fixed costs + profit goal) ÷ (price − variable cost per unit). Enter your numbers to see the sales volume and revenue that reach your profit goal.

Updated · Standard cost-accounting formulas, shown in full below.

Try an example
Profit before tax, for one period.
    Units to hit your goal 700

    units per period — 200 beyond break-even.

    $14,000 Costs + profit goal $20.00 Kept per unit 700 Units to hit the goal

    That's 40% more volume than simply breaking even, and the profit only starts accumulating after unit 500.

    Sales needed $35,000.00
    Break-even first 500

    If something changed

    • Price up 10% to $55.00 560 units
    • Fixed costs down 10% to $9,000 650 units

    Target profit chart

    Every unit from zero to your goal
    What that volume has to cover $14,000.00
    Fixed costs Profit goal
    The first 500 units only pay off fixed costs. Profit starts on unit 501, and the last 200 are what you actually take home.

    Target profit analysis

    • Hitting $4,000 of profit takes 700 units, or about $35K in sales.
    • Only 200 units of that is profit-earning volume — the rest just covers costs.
    • At $20.00 of contribution per sale, every extra 100 units adds $2,000 of profit.

    Target profit formula

    Formula and worked example

    Your profit goal is treated as an extra amount to cover on top of fixed costs, paid down by each unit's contribution margin.

    contribution margin = price − variable cost per unit units needed = (fixed costs + profit goal) ÷ contribution margin

    Revenue needed is that unit count times your price, measured at the exact unrounded volume. The displayed count rounds up, since you can't sell part of a unit.

    Worked example

    Fixed costs
    $10,000
    Profit goal
    $4,000
    Contribution margin
    $50 − $30 = $20
    Break-even
    500 units
    To hit the goal
    700 units · $35,000

    Target profit FAQ

    How is this different from the break-even calculator?

    Break-even finds the volume where profit is exactly zero. This calculator finds the volume needed to reach a profit goal above zero, by treating your desired profit the same way as an extra fixed cost to cover.

    What if I set the desired profit to $0?

    You'll get the same answer as the break-even calculator — required units will equal your break-even point, since reaching $0 profit is exactly breaking even.

    Why does it reject some combinations of price and cost?

    If your variable cost per unit is equal to or greater than your selling price, each sale contributes nothing (or a loss) toward fixed costs or profit. No volume of sales can reach a profit target in that situation.

    Does this account for taxes?

    No — this is a simple contribution-margin model based on the costs and price you enter. The profit figure it targets is operating profit before tax, and it doesn't model financing costs or anything outside fixed and variable costs.

    Related calculators

    Next
    Next step Contribution Margin Calculator Both answers above hinge on contribution per sale. Check it on a single product.