Software Development Cost Calculator
Cost a build including tools, overhead and a contingency reserve.
In short
Cost a build including tools, overhead and a contingency reserve.
Formula: Labour = Effort × Loaded cost per person-month; Base = Labour × (1 + Overhead rate) + Tools + Infrastructure; Total = Base × (1 + Contingency rate)
What this calculator does
Cost accumulation over an effort estimate. Every component is entered by the user, and optional components left at zero are excluded from the total.
Use it to turn Currency, Estimated effort, Loaded cost of one person-month, Tools and licences (optional), and the other shown inputs into a checked result you can compare, copy, or rerun with different assumptions.
The page shows the formula, a numeric worked example, and the assumptions that affect this professional & industry calculation.
Inputs and what they mean
- Currency
- — Amounts are shown in the currency you pick. No exchange rate is applied..
- Estimated effort
- — Person-months from your sizing model..
- Loaded cost of one person-month
- — number value.
- Tools and licences (optional)
- — Optional component. Leave at 0 to exclude it from the result..
- Infrastructure and environments (optional)
- — Optional component. Leave at 0 to exclude it from the result..
- Overhead applied to labour (optional)
- — Optional component. Leave at 0 to exclude it from the result..
- Contingency reserve (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
Labour = Effort × Loaded cost per person-month; Base = Labour × (1 + Overhead rate) + Tools + Infrastructure; Total = Base × (1 + Contingency rate).
Inputs used: Currency, Estimated effort, Loaded cost of one person-month, Tools and licences (optional), Infrastructure and environments (optional), Overhead applied to labour (optional), Contingency reserve (optional).
Edge handling: Estimated effort is required.; Estimated effort cannot be negative.; Estimated effort must be no more than 1000000000.; Loaded cost of one person-month is required.; Loaded cost of one person-month cannot be negative..
Worked example
286 person-months with tools and a reserve
- Start with Currency: USD, Estimated effort: 286, Loaded cost of one person-month: 14000, Tools and licences (optional): 60000, Infrastructure and environments (optional): 40000, Overhead applied to labour (optional): 15.
- Apply the method: Labour = Effort × Loaded cost per person-month; Base = Labour × (1 + Overhead rate) + Tools + Infrastructure; Total = Base × (1 + Contingency rate).
- Optional components left at zero are excluded, not guessed.
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
- Inputs outside the supported range are rejected rather than forced into a result.
- The result depends on the values you enter for this software development cost calculator; it does not supply missing rates, rules, prices, dates, or assumptions for you.
Reference: University of Southern California, Center for Systems and Software Engineering — COCOMO II model definition manual
Last reviewed:
Common questions
Where does this formula come from?
COCOMO II Model Definition Manual — post-architecture effort PM = A × Size^E × ΠEM with A = 2.94 and E = B + 0.01 × ΣSF (B = 0.91), and schedule TDEV = C × PM^(D + 0.2 × (E − B)) × SCED%/100 with C = 3.67 and D = 0.28. See the source link on this page.
What kind of calculation is this?
Effort is costed at the organisation's own person-month cost, then optional components, overhead and contingency are added. Check the formula, example, and limitations on this page before using the result for a real professional & industry decision.
What are its limits?
Gives a cost, not a price. Inherits the uncertainty of the effort estimate it is given.
How do I use the Software Development Cost Calculator?
Enter the required values for Currency, Estimated effort, Loaded cost of one person-month, Tools and licences (optional), Infrastructure and environments (optional), and the other fields shown. The calculator applies the formula on this page and shows the main result with any supporting breakdown so you can check the arithmetic.
What formula does the Software Development Cost Calculator use?
Labour = Effort × Loaded cost per person-month; Base = Labour × (1 + Overhead rate) + Tools + Infrastructure; Total = Base × (1 + Contingency rate) The visible formula section above lists the calculation path and the edge cases the page handles, so the result can be checked without relying on the form alone. Check the formula, example, and limitations on this page before using the result for a real professional & industry decision.
Can the Software Development Cost Calculator be used for exact decisions?
Use it as a calculation aid, not as a substitute for checking the underlying rule, contract, policy, or professional advice that applies to your situation. When a result depends on local rules, personal details, prices, or dates, enter those values yourself and confirm them before acting.
Formula, source and verification
Effort is costed at the organisation's own person-month cost, then optional components, overhead and contingency are added.
The question it answers: What does this build cost once tools, environments, overhead and a reserve are counted?
The formula
Labour = Effort × Loaded cost per person-month; Base = Labour × (1 + Overhead rate) + Tools + Infrastructure; Total = Base × (1 + Contingency rate)
- PM — Estimated effort
- (person-months). Effort from the organisation's sizing model.
- c — Loaded cost of one person-month
- (currency). Employer cost of one person-month.
- T — Tools and licences
- (currency). Optional.
- I — Infrastructure and environments
- (currency). Optional.
- o — Overhead rate
- (%). Optional overhead applied to labour, using the organisation's own allocation.
- g — Contingency rate
- (%). Optional reserve for identified risk.
Units: Person-months; 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
Cost accumulation over an effort estimate. Every component is entered by the user, and optional components left at zero are excluded from the total.
Assumptions built into the result
- Mathematical: All components cover the same scope and period as the effort estimate.
Figures this calculator will never guess for you
- No industry delivery rate, productivity figure, defect rate or cost per line is inserted.
- No optional component is filled in on the user's behalf.
- No default overhead or contingency percentage is applied.
Limitations
- Gives a cost, not a price.
- Inherits the uncertainty of the effort estimate it is given.
Source and version
- Standard or reference
- COCOMO II post-architecture model — University of Southern California, Center for Systems and Software Engineering (COCOMO II Model Definition Manual — post-architecture effort PM = A × Size^E × ΠEM with A = 2.94 and E = B + 0.01 × ΣSF (B = 0.91), and schedule TDEV = C × PM^(D + 0.2 × (E − B)) × SCED%/100 with C = 3.67 and D = 0.28.)
- Published source
- University of Southern California, Center for Systems and Software Engineering — COCOMO II.2000
- 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.
Cite this page
Free Calculator. (2026, September 16). Software Development Cost Calculator. https://freecalculator.tech/tools/software-development-cost-calculator
"Software Development Cost Calculator." Free Calculator, 16 Sept. 2026, https://freecalculator.tech/tools/software-development-cost-calculator.
Software Development Cost Calculator — Free Calculator, https://freecalculator.tech/tools/software-development-cost-calculator
Related tools
Work out the hourly rate to charge a client so that target margin is met after overhead and non-billable time.
Find the true hourly cost of an employee once benefits, payroll cost and overhead are included.
Size a software application from its data and transaction functions before estimating effort or cost.
Estimate development effort, schedule and average team size for a software project of a known size.
Express cloud spend as a cost per customer, per transaction or per other business unit.
Set the rate used to apply manufacturing overhead to jobs for the coming period.