When a business wants to calculate exactly how much revenue it earns from the sale of its products, it looks at the contribution margin ratio. The contribution margin ratio tells a company how much ...

Calculating how much a product or your entire inventory contributes to your bottom line is necessary to grow revenue. However, when you carry a variety of goods, calculating a breakeven point on sales ...

Discover what a shutdown point is in economics—when companies decide it’s more practical to cease operations temporarily or permanently due to revenue not covering variable costs.

When you run a company, it’s obviously important to understand how profitable the business is. Many leaders look at profit margin, which measures the total amount by which revenue from sales exceeds ...

Memo from the Securities and Exchange Commission: If you want to use contribution margin to tout how well your company is doing, you might want to think twice. WeWork tried to brag about its ...

Learn how to calculate the pretax profit margin, understand its uses in financial analysis, and explore examples for evaluating company efficiency before taxes.