Revenue, Costs, Contribution, Profit

• Sales Revenue = Selling Price x Quantity
• Average Cost = Total Costs / Quantity
• Total Cost = Fixed Costs + Variable Costs
• Profit = Total Revenue - Total Costs
• Profit = Total Contribution - Fixed Costs
• Profit = Margin of Safety x Contribution per Unit
• Total Contribution = Sales Revenue - Total Variable Costs x Quantity Sold
• Contribution per Unit = Selling Price per Unit - Variable Cost per Unit
• Contribution - The amount that each item sold will contribute towards the fixed costs of a business
• Revenue - The money a business makes from sales
• Fixed Costs - Remain the same whatever the level of output produced is
• Variable Costs - Increase in proportion to output