Cost Calculator - Unit Cost, Cost Ratio & Target Selling Price

Calculator/Business Calculator/ Cost Calculator

What is the Cost Calculator?

Calculate what it actually costs to make one product or service. Add materials, labor and overhead to get the total cost, divide by quantity to get the unit cost, then add your target margin to set a selling price.

Enter Costs

Formula

Total cost = materials + labor + overhead. Unit cost = total cost / quantity. Selling price = unit cost / (1 - margin). Cost ratio = unit cost / selling price x 100.

How to Use

Enter materials, labor and overhead. Leave any item that does not apply at 0.
Enter the production quantity. If you made only one, enter 1.
To get a selling price too, enter your target margin and press Calculate.

Example

With materials 300,000, labor 200,000 and overhead 100,000 for 100 units, the total cost is 600,000 and the unit cost is 6,000. At a 30% target margin the selling price is 6,000 / 0.7 = about 8,571 and the cost ratio is 70%.

Frequently Asked Questions

What is the difference between margin and cost ratio?

Both are based on the selling price. Margin is the share of the price that is profit, cost ratio is the share that is cost, and together they add up to 100%.

What should I include in overhead?

Costs that do not go directly into the product but are needed for production: rent, utilities, equipment depreciation, consumables, shipping, payment fees and so on, allocated to the relevant period and quantity.

Can I enter a markup (percentage of cost) as the margin?

This calculator uses margin based on the selling price. If you want to add 30% on top of cost, the price is cost x 1.3, so use the Price Calculator or work it out directly.