formulas

• variable cost per hour = change in variable cost / change in labor hours
• unit sales to break even = fixed expenses / CM per unit
• break even sales = fixed expenses / CM ratio
• profit = sales - variable cost - fixed expenses
• profit = unit CM x Q - fixed expenses
• profit = CM Ratio x sales - fixed expenses
• unit sales to attain target profit = (target profit + fixed expenses) / CM per unit
• amount of sales to attain target profit = (target profit + fixed expenses) / CM ratio
• target profit % = ((target profit + fixed expenses) / CM ) x 100%
• degree of operating leverage = CM / Net operating income
• Contribution margin =

  sales (volume: sales/selling price)

  less: variable costs