Business Budget Calculator
Plan your month before it happens. Enter your expected revenue and each category of expense to see your net profit, profit margin, and expense ratio — plus a breakdown of what share of revenue each cost consumes.
Expense breakdown
See how each expense category compares to your monthly revenue. Costs that consume a large share are the first place to look when you want to widen your margin.
| Expense | Amount | % of revenue |
|---|
How the business budget calculator works
A budget is simply a plan for the money you expect to earn and spend. This tool compares your projected monthly revenue against each expense category so you know, before the month begins, whether the plan produces a profit and how much room you have to spend.
Profit margin = net profit ÷ revenue × 100
Expense ratio = total expenses ÷ revenue × 100
First the calculator adds every expense you enter — rent, payroll, inventory or cost of goods sold, marketing, software, utilities, insurance, a set-aside for taxes, and anything else. That sum is your total expenses.
Subtracting total expenses from revenue gives your net profit for the month. Dividing that profit by revenue gives your profit margin — the share of every dollar of sales you actually keep. The mirror image is the expense ratio, the share of revenue consumed by costs; margin and expense ratio always add up to 100%.
Finally the tool multiplies monthly net profit by twelve to give a rough annualized figure. Because the calculator divides by revenue, the margin and ratio are only shown when revenue is greater than zero.
What affects your margin
- Pricing — raising prices lifts revenue without adding most fixed costs, widening margin fast.
- Cost of goods — inventory and COGS scale with sales, so supplier terms matter.
- Fixed overhead — rent, software, and insurance stay flat, so they hurt more in slow months.
- Payroll — usually the single largest line and the biggest lever on the expense ratio.
Tips for a healthier budget
- Review your largest expense categories in the breakdown table first.
- Always set aside a share of revenue for taxes so it does not surprise you.
- Confirm the budget matches reality with the cash flow calculator.
- Check your profit margin and break-even point against targets.
Frequently asked questions
What is a business budget?
A business budget is a plan that compares the revenue you expect to earn in a period against the expenses you expect to pay. The difference is your projected net profit. A budget helps you spot overspending before it happens and set realistic targets.
How is profit margin calculated?
Profit margin is net profit divided by revenue, expressed as a percentage. In this tool it equals (revenue minus total expenses) divided by revenue, times 100. If revenue is zero the margin is not defined.
What is a good expense ratio?
Expense ratio is total expenses divided by revenue. A lower ratio leaves more profit. What counts as healthy varies by industry, but keeping the ratio well under 100% is essential, and many small businesses target 70% to 90%.
How do I turn a monthly budget into an annual figure?
For a simple estimate, multiply your monthly net profit by 12. This calculator shows the annualized figure automatically, though real results vary with seasonality and one-time costs.
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This calculator is for educational and informational purposes only and does not constitute financial, tax, or accounting advice. Estimates are based solely on the values you enter. Confirm your figures with a qualified advisor before making decisions.