Payroll Percentage Calculator

Formula

To calculate the payroll percentage ($PP$):

\[ PP = \left( \frac{TP}{TR} \right) \times 100 \]

Where:

$PP$ is the payroll percentage (%)
$TP$ is the total payroll (\$)
$TR$ is the total revenue (\$)

What is Payroll Percentage?

Payroll percentage is a financial metric that shows what portion of a company’s revenue is spent on payroll, including wages, salaries, and benefits. It is a key indicator of how labor-intensive a company is and can be used to assess the efficiency of labor costs in relation to revenue generation.

Example Calculation

Let's assume the following values:

Total Payroll ($TP$) = \$500,000
Total Revenue ($TR$) = \$2,000,000

Using the formula:

\[ PP = \left( \frac{500,000}{2,000,000} \right) \times 100 = 25\% \]

The payroll percentage is 25%.