Target Profit Margin

Ever wonder how many times you had to do something to make x amount of dollars? Check out this formula it is called target profit margin and it allows you to calculate the amount of money you want to make based on a residual time period. Implement this formula to any situation, or project you are involved in.
Before I get to that we need to discuss and familiarize ourselves with three key terms, target profit, fixed costs, and unit contribution margin. Target profit is the amount of money overall you want to make. Fixed costs are the costs that you will incur even if production is not occuring. Unit contribution margin is the difference between the price you paid for the item minus the price you intend to sale the item for (speaking in terms of one unit) the formula should look like this

Fixed Costs + Target Profit / Unit Contribution Margin

The answer you get once done with completion of this equation represents the amount of times a person must do this transaction.

Warren, Reeve, Financial and Managerial Accounting: 2007, Mason OH