Margin and markup calculator

Choose the two values you know to calculate profit, price, cost, margin and markup.

Cost
Selling price

Profit from the sale

400

Cost600
Selling price1,000
Margin40 %
Markup66.67 %

Use the same currency or accounting unit for every amount.

Contents

Margin and markup measure different bases

Cost and profit blocks combining into a selling price

Margin compares profit with the selling price, while markup compares the same profit with cost. The calculator keeps those denominators separate and can solve the relationship from any supported pair of values.

Choose the pair you actually know

Select cost and selling price to inspect an existing offer. Select cost and markup to set a price. Select selling price and target margin to find the maximum cost that preserves that margin.

P=Sโˆ’C,M=PSร—100%,U=PCร—100%P=S-C,\qquad M=\frac{P}{S}\times100\%,\qquad U=\frac{P}{C}\times100\%

Three worked price decisions

Cost 600, selling price 1,000. Profit is 400. The margin is 40% because 400 is divided by 1,000; markup is 66.67% because 400 is divided by 600.

Cost 600 and markup 50%. The selling price is 900 and profit is 300. That price has a 33.33% margin, not a 50% margin.

Selling price 1,000 and target margin 40%. Cost may be 600, leaving profit of 400 and markup of 66.67%.

What belongs in cost changes the meaning

S=C(1+U100),C=S(1โˆ’M100)S=C\left(1+\frac{U}{100}\right),\qquad C=S\left(1-\frac{M}{100}\right)

A result is only as broad as the cost entered. Purchase cost alone gives a product-level gross figure. Shipping, payment fees, labor, tax, returns, overhead, and discounts can change the real business result if they are not included.

A loss is valid input: cost 1,000 and selling price 800 gives a loss of 200, margin of -25%, and markup of -20%. When selling price is zero, margin is undefined; when cost is zero, markup is undefined.

Questions about margins and markups

The answers below clarify the denominator and the practical limits of the calculation.

Is margin the same as markup?

No. Margin divides profit by selling price, while markup divides profit by cost. They are equal only when profit is zero.

What markup gives a 40% margin?

A 40% margin corresponds to a 66.67% markup. For example, cost 600 becomes a selling price of 1,000.

Can markup exceed 100%?

Yes. A 100% markup doubles cost and produces a 50% margin. Markup has no 100% ceiling.

Why must margin be below 100%?

At a positive selling price, a 100% margin implies zero cost. Values above 100% would imply a negative cost in this model.

Does the result equal net profit?

Not necessarily. It is net profit only if the cost includes every expense relevant to the sale and period.

Which currency should I use?

Any currency or accounting unit works, provided cost and selling price use the same one. The calculator does not convert currencies.

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