The concept of a contribution margin comes from the need for business managers to understand how profitable their businesses have become. For most managers, this is as simple as looking at something ...

Learn how to calculate the variable cost ratio to balance production costs and revenues. Understand its role in optimizing profit margins and business decision-making.

Small and large businesses need to understand the relationship between cost, volume and profit to develop their pricing strategies. Setting prices too high might mean lost sales, while discounting ...

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

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 ...

Contribution margin is the amount of money left over from sales after deducting variable costs. It represents the portion of sales that helps cover fixed costs and eventually contributes to profit. By ...