Project Net Margin Calculator
See what a project leaves after direct, overhead and administrative cost.
What this calculator does
Only the indirect costs the firm allocates are subtracted; nothing is allocated automatically.
Inputs and what they mean
- Currency
- — Amounts are shown in the currency you pick. No exchange rate is applied..
- Project revenue
- — number value.
- Direct project cost
- — number value.
- Allocated overhead (optional)
- — Optional component. Leave at 0 to exclude it from the result..
- Selling, admin and other allocated cost (optional)
- — Optional component. Leave at 0 to exclude it from the result..
How to use it
- Enter your own figures — the calculator never fills in a rate, price or benchmark for you.
- Press Calculate to see the result.
- Read the formula, variables, assumptions and source below the result before you rely on it.
Formula
Net margin = (Revenue − Direct cost − Allocated overhead − Other allocated cost) ÷ Revenue
Worked example
Same project after overhead and admin cost
Only the indirect costs you allocate are subtracted.
Reading the result
The headline figure is the main answer. Any breakdown underneath shows the parts that make it up, so you can check the working and see what changes when you adjust an input.
Limitations and assumptions
Results depend entirely on the figures you enter and are rounded for display. They are for general information and education, not professional advice.
Reference: Rice University — Principles of Accounting, Volume 2: Managerial Accounting
Last reviewed:
Common questions
Formula, source and verification
Revenue less all costs allocated to the project, expressed as a share of revenue.
The question it answers: What does this project leave after overhead and administrative cost?
The formula
Net margin = (Revenue − Direct cost − Allocated overhead − Other allocated cost) ÷ Revenue
- R — Project revenue
- (currency). Amount billed or expected.
- C — Direct project cost
- (currency). Cost of delivery.
- O — Allocated overhead
- (currency). Optional overhead allocated to the project.
- A — Other allocated cost
- (currency). Optional selling and administrative cost allocated to the project.
Units: Currency; percentages.
What kind of calculation this is
Deterministic formula. The same inputs always give the same answer. The maths is fixed and does not depend on judgement.
Method
Only the indirect costs the firm allocates are subtracted; nothing is allocated automatically.
Assumptions built into the result
- Mathematical: Allocated amounts follow the firm's own allocation method.
Figures this calculator will never guess for you
- No industry-average rate, margin, overhead or ticket volume is inserted.
- No optional component is filled in on the user's behalf.
- No overhead percentage is applied when none is entered.
Limitations
- The result depends entirely on the allocation method behind the amounts entered.
Source and version
- Standard or reference
- Cost accumulation, cost-plus pricing, margin and markup (OpenStax, Principles of Accounting Volume 2: Managerial Accounting — job order costing, cost-plus pricing, margin and markup.)
- Published source
- Rice University — OpenStax (CC BY)
- Formula version
- Version 1
- Verification
- Reviewed against the cited source on
- How much weight the source carries
- Academic
- Applies to
- Currency
- Amounts stay in the currency you choose; no exchange rate is applied.
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