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Agency Expense Calculator

The Agency Expense Calculator totals the major costs of operating an agency and shows each cost group as a share of revenue. It combines payroll, contractors, software, marketing, occupancy, and other expenses for a consistent reporting period.

Owners and finance teams can use the result to build a budget, review cost structure, or identify the categories with the greatest impact on operating profit. The calculator reports expenses only; it does not determine tax liability or cash timing.

Enter your assumptions

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Result
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Total agency expenses
Expense ratio—
Operating remainder—
People costs—
Largest cost group—

1. Match the period
Use revenue and expenses from the same month, quarter, or year.

2. Enter people costs
Include payroll, employer-paid benefits, and contractor spending in their respective fields.

3. Add operating costs
Enter software, marketing, occupancy, and other expenses.

4. Review total expenses
The headline shows the combined operating cost for the period.

5. Assess cost intensity
Compare the expense ratio, operating remainder, and largest category.

Total Expenses = Payroll + Contractors + Software + Marketing + Occupancy + Other Expenses
Expense Ratio = Total Expenses ÷ Revenue × 100

Where:

  • Payroll = wages, salaries, payroll taxes, and benefits included by the user
  • Contractors = external delivery or support labor
  • Software, Marketing, Occupancy, Other = operating cost categories
  • Revenue = sales for the same reporting period

What the result means

The result shows total entered expenses, and the expense ratio indicates how much of revenue those costs consume.

The operating remainder is revenue minus entered expenses and may not equal accounting net income if taxes, interest, depreciation, or omitted costs apply.

Given: Revenue of $90,000; payroll $38,000; contractors $12,000; software $4,000; marketing $5,000; occupancy $3,000; other expenses $4,000.

Calculation: Total expenses = $38,000 + $12,000 + $4,000 + $5,000 + $3,000 + $4,000 = $66,000. Expense ratio = $66,000 ÷ $90,000 × 100 = 73.3%.

Result: Total expenses are $66,000, leaving a $24,000 operating remainder before unentered items.

Should payroll include owner compensation?

Include it when you want the expense total to reflect the cost of the owner’s operating role. For valuation analysis, owner compensation may need normalization.

Are contractor costs part of cost of services?

They may be classified that way in accounting, but this calculator presents them as a separate operating category for visibility.

What belongs in other expenses?

Use it for costs not covered by the named fields, such as insurance, professional fees, travel, or bank charges.

What happens when expenses exceed revenue?

The operating remainder becomes negative, indicating that entered costs are greater than revenue for the period.

Does the result equal taxable profit?

No. Taxable profit depends on accounting and tax rules, deductible items, timing, and jurisdiction-specific treatment.