Accurate calculations are essential to the financial health of any company. It is crucial to utilize the correct tools when planning for startup costs when calculating your breakeven level, or analyzing a potential acquisition. Calculations can be simple or complex but the results are important.
Start-up costs cover the costs necessary to establish a company like fixtures, equipment and office supplies. Start-up costs can include research expenses like market and industry analyses. A good estimate of startup costs can be made by studying the financial statements of comparable businesses in your sector or speaking with your accountant or bookkeeper for advice on particular cost categories. It’s also an excellent idea to add a safety buffer of 10%, when you calculate your initial costs to account for the unexpected.
Calculating your total cost can allow you to determine if you can earn a profit from selling your products or services. You can calculate your cost of goods sold (COGS) by using a formula. This is a crucial figure in determining the price and profit margins.
The top business calculators offer numerous functions and are easy to use. Some calculators for business have built-in functions such as amortization and interest rate conversions. Some may also have visual graphs or connect to a computer for safe storage of calculations. You can also find business calculators with more advanced features, like an NPV calculator, which employs the concept of discounted cash flow to calculate the net value of cash flows in the future.