Markup and Profit Calculator





Formulas

The formulas used in the calculations are:

\[ \text{markup} = \left( \frac{1}{1 - \text{margin}} \right) - 1 \]

\[ \text{profit} = \text{revenue} \times \frac{\text{margin}}{100} \]

Description

This calculator computes the markup percentage and profit based on the input values of margin and revenue. It also shows how to calculate profit using the given formulas.

Example Calculation

Let's assume the following:

Calculate the markup percentage:

\[ \text{markup} = \left( \frac{1}{1 - 0.05} \right) - 1 = 0.0526 \approx 5.26\% \]

Calculate the profit:

\[ \text{profit} = 1000 \times \frac{5}{100} = 50 \]

Therefore, the markup percentage is approximately 5.26%, and the profit is $50.

FAQs

How do I calculate the markup from the margin?

To calculate the markup from the margin, follow these easy steps:

  1. If you know the margin as a percentage, divide it by 100 to find its decimal value.
  2. Find the decimal markup with the following formula:
  3. \[ \text{markup} = \left( \frac{1}{1 - \text{margin}} \right) - 1 \]

  4. Multiply the result by 100% to find the percentage markup.

What is my profit on a $1000 revenue with 5% margin?

The profit would be $50. To find this result, invert the formula we use to calculate the revenue knowing the profit:

\[ \text{revenue} = 100 \times \frac{\text{profit}}{\text{margin}} \]

Find the profit with the following formula:

\[ \text{profit} = \text{revenue} \times \frac{\text{margin}}{100} = 1000 \times \frac{5}{100} = 50 \]