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Contribution Margin Approach to Cost-Volume-Profit Analysis

This chart enables you to visualize the components of costs and revenue from a Contribution Margin point of view. In this view, the difference between the selling price and the variable cost of each successive unit sold is allocated to the payment of fixed costs until these costs are fully paid. Thereafter, the difference from each unit contributes to the profit.

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Information and interactive calculators are made available to you only as self-help tools for your independent use and are not intended to provide investment or tax advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.