Units Sales for Desired pretax Profit

The Units Sales for Desired pretax Profit calculator computes the number of units needed to be sold to achieve a pretax profit based on the fixed cost and the contribution margin per unit sale.

INSTRUCTIONS: Choose units and enter the following:

• ( FC) Fixed Cost

• (BTP) Before Tax Profit Goal

• (CMP) Contribution Margin Per Unit

Unit Sales to Achieve Desired Pre-tax Profit (US):  The number of unit sales needed to achieve pre-tax profit goal

The Math / Science

The sales dollars desired after-tax profit can be attained by adding the fixed costs to the before tax-profit and dividing this by the company's contribution margin ratio.  The formula for Sales Dollars Desired After-tax Profit is:

   US = (FC + BTP)/CMP

where:

• US = Unit Sales to Achieve Desired Pretax Profit
• FC = Fixed Cost
• BTP = Before Tax Profit
• CMP = Contribution Margin Per Unit

Target Profit Calculators

• Unit Sales for Desired After Tax Profit
• Unit Sales for Desired Pre-tax Profit

Resource:

• Dopson, Lea R., and David K. Hayes. Managerial Accounting for the Hospitality Industry. Hoboken, NJ: Wiley, 2009. Print.