How to Calculate Total Revenue

Video Transcript

"Hi, I'm Spence Cottam with Account Teams and this is Jeannine and we help people out with their accounting needs in Salt Lake City. We help them with their books and a lot of other problems with their business and it's, it's been a lot of fun. Now we've got into some interesting help for different businesses. I'm going to talk to you today about what total revenue means. If you're selling items and you sell so many items at a certain price and you're getting a certain amount of money in for that; in some cases, you cannot increase your price and ten percent and only lose five percent of your customers because; you lose them because the prices too high for them. In other cases you can increase at ten percent and you lose fifty percent of your customers because; and your, and your total profitability will go down. So what you have to look at on total revenue is on price changes and you should probably try to not maximize the price, but maximize the price times the number of items you could sell at that price. Total revenue is very simple. Multiply the total number you, of items you sell by the cost you sell them for to get the total revenue you could get for selling those items."