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How is Contribution Margin calculated in BC?

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Posted on by RH

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After we created a report to show profits, we've noticed a difference in margins shown. I believe developer used the unit price subtracted by the unit cost in item card whereas the BC report "Customer/Item Statistics" show a "Contribution Margin" that doesn't match. It appears the the unit cost shown on the item card is a running average.

How can we make it match what BC shows and how is this Contribution Margin calculated? What datatable would we need to pull these fields, etc.?

Thanks!

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Dynamics 365 Business Central

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Mansi Soni 8,909 Super User 2025 Season 2 on at

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Hello, The difference in margins comes from how Business Central calculates unit cost. The Customer/Item Statistics report uses Contribution Margin, which considers actual transaction costs from purchases, inventory adjustments, and value entries.

On the other hand, the unit cost on the Item Card is a running average and might not reflect the exact cost at the time of sale. To match what BC shows, you should pull cost data from the Value Entry and Item Ledger Entry tables instead of relying solely on the Item Card. This will give you a more accurate profit calculation.

Hope this answer solve your question!

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Mansi Soni

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Jainam M. Kothari 15,639 Super User 2025 Season 2 on at

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Hello,

In the Item Card, You can define the "Price/Profit Calculation". And based on Price/Profit Calculation field, You can define the "Unit Price" or "Profit %" in the Item Card.

Contribution Margin=Sales Revenue−Variable Costs

In BC, this typically involves:

Sales Revenue: Sum the Amount field from the Sales Line table.

Variable Costs: Sum the Cost Amount (Actual) field from the Item Ledger Entry table.

By aligning your data sources and calculations with BC's methods, you should be able to match the Contribution Margin shown in the "Customer/Item Statistics" report.

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Khushbu Rajvi. 20,579 Super User 2025 Season 2 on at

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Hope this helps as weell: https://learn.microsoft.com/en-us/dynamics365/business-central/finance-about-calculating-standard-cost

https://community.dynamics.com/forums/thread/details/?threadid=94f0a975-7a17-4cec-b8a9-ce033cff8f4f

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