If you DO work in the field, determine how much you'd have to pay another working foreman to get you out of the field.

Now, determine how much you'd have to pay an executive to perform your management tasks. Allow for a realistic profit bonus in that estimate. Anyone capable of running your firm profitably will demand a salary plus bonus.

Add the two numbers together and you just calculated your WAGE.

STEP NUMBER 2: Determine your investment return.

Sadly, after running the first calculation, many contractors discover they aren't making a return on their investment. This is called "owning a job." That's not the goal!

We are going to go with a simple method of determining your return on investment. Financial types would wrist slap me for not calculating "properly" but who cares what those stuffed shirts think anyway, right?

Take last year's income statement and enter the data into a spreadsheet. We need to make a few adjustments.