Business Calculations
The financial health of a business is dependent on accurate calculations. It is essential to use the appropriate tools when planning the initial costs, calculating your breakeven point, or analyzing a potential acquisition. Business calculations can be straightforward or complex but the outcomes are critical.
The costs for starting up include the expenses required to begin a new business that include fixtures, equipment and office equipment. Research expenses, which include analysis of the market and industry could also be included in the start-up costs. It is possible to estimate startup costs by examining the financial statements of companies that are in your field, or asking your accountant or bookkeeper for specific cost categories. It is also recommended to add an insurance cushion like 10% of your initial costs, to be prepared for the unforeseeable.
Calculating your total cost will allow you to determine if you will earn a profit after selling your services or products. Calculate your cost of goods (COGS) by using a formula. This number is crucial for determining the cost of goods sold and profit margins.
The best business calculators are simple to use and have a variety of functions. Some calculators for business have built-in functions, such as amortization and interest rate conversions. Some business calculators have visual graphs, and others connect to computers so that calculations can be stored safely. There are many business calculators that have more advanced features. For example, an NPV calculator that makes use of the discount-cash-flow method to calculate the net present value.