Learn as you go · Free lesson
Understand your job estimate & profit result
Start with the calculator above. Then follow the example below, one step at a time.
What this calculator does
A customer price is not the same as the money a job leaves for your business. This calculator separates charges from costs so you can see where a repair or service estimate gains or loses money.
Use one complete job, including the estimating visit and any fee credit. The result is an internal planning check, not a customer invoice or a calculation of actual tax. Enter your own charges, costs and reserve percentage.
How it works
Add the estimate fee, materials with markup, billed labor, travel and other customer charges. Subtract any estimate-fee credit and other discount. Materials markup adds a percentage of material cost; it is not a target profit margin.
Separately add your estimate cost, material purchases, labor cost or owner-time allowance, travel cost and other job costs. The gap between the customer total and those costs is job profit before reserve.
A reserve is money you choose to set aside. The calculator applies your chosen percentage to positive job profit, then shows what remains. It does not calculate the tax you owe. Include overhead once, and avoid counting an owner-time allowance twice.
Job profit = customer charges − credits − discounts − entered job costs. Tax reserve = positive job profit × your chosen rate. Profit after reserve = job profit − reserve.
Worked example
Example only. These are fictional business numbers, not recommended targets.
- Example: a fictional door repair has a $35 estimate fee, fully credited toward the job. Together those two entries add zero to the combined job price.
- Materials cost $120. A 30% markup makes the materials charge $156. Two hours billed at $90 add $180. Travel of $30 and other charges of $10 bring the customer total to $376 before sales tax.
- Costs are $15 to estimate, $120 materials, $70 labor allowance, $18 travel and $8 other costs. Total cost is $231.
- Subtract $231 from $376. Profit before reserve is $145. A chosen example reserve of 25% sets aside $36.25.
- The planning amount after reserve is $108.75. That is not $376 of take-home pay. It also is not the remaining invoice balance if the customer has already made a payment.
How to read your result
A positive figure means the entered charges cover the entered costs and reserve. A negative figure means the job shows a loss before any positive-profit reserve is applied. Check forgotten time and costs before deciding the price works.
The margin shown is before reserve. Compare jobs with the same cost categories, not just the same customer price. A job needing an extra visit may leave less than a similar job completed in one trip, even if their quoted prices match.
Common mistakes
- Confusing the hourly selling rate with the worker’s actual cost.
- Treating materials markup as the same percentage as profit margin.
- Giving an estimate-fee credit twice or counting a paid fee twice.
- Leaving travel, payment fees or overhead out of the job plan.
FAQ
What if my estimate visit is free?
Enter zero for the customer fee. Still enter the cost of your estimating time or travel if it is not counted elsewhere.
How should a fee credit work?
Enter the fee charged and the amount credited toward the job. The credit cannot exceed the estimate fee, and the combined result is not a payment-tracking balance.
Is my chosen reserve my actual tax rate?
Not necessarily. It is only a planning percentage you enter. Ask a qualified professional about your actual obligations rather than treating the example as advice.
Does an owner labor allowance mean payroll?
No. It gives your time a planning cost in this estimate. It does not determine payroll treatment or confirm a tax deduction.
Can I send this breakdown to the customer?
The breakdown contains internal costs and profit, so treat it as internal. Use a separate customer document that includes agreed charges and terms without revealing internal figures.
Related calculators and guides
Educational estimates based on your inputs. Not financial, tax, or legal advice.