Free Contribution Margin Calculator
Calculate contribution margin ratio and per-unit contribution margin. Understand how much each unit sold contributes to covering fixed costs.
Contribution Margin Ratio
60.00%
Contribution Margin Ratio vs Selling Price Per Unit
How to Calculate Contribution Margin
Formula
Contribution Margin Ratio = [(Price - Variable Cost) / Price] x 100 Contribution Margin Per Unit = Price - Variable Cost
Contribution margin tells you how much each unit sold contributes to covering fixed costs and generating profit. It is essential for break-even analysis and pricing decisions.
Example Calculation
A product sells for $100 with a variable cost of $40 per unit.
- 01Contribution margin per unit = $100 - $40 = $60
- 02Contribution margin ratio = ($60 / $100) x 100 = 60%
- 03Variable cost ratio = ($40 / $100) x 100 = 40%
Frequently Asked Questions
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