Sales Volume for Desired after tax Income

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

INSTRUCTIONS: Choose units and enter the following:

• ( FC) Fixed Cost

• (ATP) After Tax Profit Goal

• (TR) Tax Rate

• (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 after tax-profit and dividing this by the company's contribution margin ratio.  The formula for Sales Units for Desired After-tax Profit is:

   US = (FC + (BTP/(1-TR)))/CMP

where:

• US = Unit Sales to Achieve Desired After Tax Profit
• FC = Fixed Cost
• BTP = Before Tax Profit
• TR = Tax Rate
• 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.