Worked example
With $60,000 annual overhead, 1,600 productive hours per worker, three workers, 300 jobs and $500,000 annual revenue, the calculator shows overhead per productive hour, per average job and as a revenue percentage. An eight-person-hour job receives the hourly allocation.
| Result | Calculated value |
|---|---|
| Annual productive team hours | 4,800 |
| Overhead per productive hour | $12.50 |
| Overhead per average job | $200.00 |
| Overhead as share of revenue | 12% |
These are fictional defaults for explaining the calculation, not a price or outcome claim.
How the calculation works
Choose one recovery basis for a quote. Do not add per-hour recovery and per-job recovery together. Person-hours count every worker on the job.
Read the related Serman Tools guide for definitions, limits and another worked example.
Workbook
The free calculator handles one scenario in your browser. Contractor Profit Toolkit keeps the related model in a downloadable workbook.
Frequently asked questions
Which recovery basis should I use?
Choose the basis that best tracks how your overhead is consumed and apply only one basis to the same cost pool.
Can I use fractional workers?
Yes. Fractional productive FTE can reflect part-time or partial-year capacity when the hours assumption matches.
Is this a market-rate recommendation?
No. It calculates from your inputs and does not claim a prevailing local price or guaranteed outcome.
How should overhead be entered?
Use a documented allocation that matches the period and cost pool, and avoid including the same overhead in another input.
What is the difference between markup and margin?
Markup divides profit by cost. Margin divides profit by selling price, so the same percentage does not produce the same price.
Can I use the result as a final quote?
Use it as a planning check, then confirm scope, taxes, terms, technical requirements and every cost that applies to the job.