The payoff formula is: Short call payoff per share = (premium per share - (MAX (0, (share price - strike price)). In this part we will learn how to calculate single option (call or put) profit or loss for a given underlying price.A put payoff diagram is a way of visualizing the value of a put option at expiration based on the value of the underlying stock. A call option payoff depends on stock price: a long call is profitable above the breakeven point (strike price plus option premium). Payoff diagrams are a way of depicting what an option or a set of options or options combined with other Securities are worth at option expiration. Two graphical ways of visualizing how a call option will be worth something to you or not depending on the strike price. A payoff graph will show the option position's total profit or loss (Yaxis) depending on the underlying price (xaxis). Now we have the cells ready and we can build the formula in cell C8, which will use the inputs in the other cells to calculate profit or loss. Tax Foundation is the world's leading independent tax policy nonprofit. We lead the tax reform debate toward smarter simpler policy.