Accurate calculation is essential to the financial health of any company. It is vital to use appropriate tools when planning the cost of starting up and calculating your breakeven point, or analyzing a potential acquisition. Business calculations can be simple or complex, but the results are critical.
Start-up costs are the cost needed to start a new business, including furniture, office equipment, and equipment. Research expenses, which comprise analyses of industry and market conditions could also be included in the initial costs. A good estimate of your startup costs can be determined by studying the financial statements of comparable businesses in your field or talking with your bookkeeper or accountant for guidance on specific cost categories. It’s also beneficial to add an insurance buffer such as 10%, when you calculate your initial costs to cover the unexpected.
Calculating your total cost will allow you to determine what profit, if any you will make after selling all of your products or services. Calculate your cost of goods (COGS) by using an equation. This figure is important to determine prices and profit margins.
The top business calculators offer various functions and are easy to use. Certain business calculators have built-in features such as amortization and interest rate conversions. Certain business calculators come with visual graphs, and others connect to a computer to allow calculations to be saved safely. There are also business calculators with more sophisticated features, such as an NPV calculator, which employs an estimated cash flow calculation to calculate the net present value of future cash flows.