The formulas
Target CPA = Break-even CPA − Target margin × (Price − Refunds)With no target margin, max CPA is your break-even CPA: pay more and each sale loses money.
With a target margin, the profit you want to keep is taken off first. The ROAS that matches it is price ÷ target CPA.
Using your max CPA
Set it as your cost-per-result goal or bid cap, or check campaigns against it. A campaign whose CPA stays above it is losing money (or margin), whatever its ROAS.
Questions
Should I bid at my break-even CPA?
Only if you are happy to make no profit on the first sale, for example because customers buy again. Most businesses aim below it to keep a margin.
What target margin should I use?
The share of each sale you want to keep as profit after ads. There is no standard; it depends on your fixed costs and goals.
What about repeat customers?
If customers buy several times, you can afford more for the first sale. The full calculator works out lifetime value and max profitable CAC.