Roth IRA Calculator
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Solve for margin, markup, cost or revenue from any two.
Fill in any two and the rest are calculated. Clear a field to solve for it again.
Margin and markup are not the same number
| Margin | Equivalent markup | Price on this cost |
|---|
Gross margin
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The Margin Calculator takes any two of cost, revenue, profit, margin and markup and fills in the rest. It always reports margin and markup together, because confusing the two is the most expensive arithmetic mistake in pricing.
Enter any two of cost, revenue, gross profit, margin percentage and markup percentage, and the calculator fills in the rest. It also solves the common pricing question directly: what price do I need to charge to hit a target margin on a known cost?
Margin and markup are the two figures most often confused, and the confusion is expensive. Both describe the same profit, but margin expresses it as a percentage of the selling price while markup expresses it as a percentage of cost. A fifty percent markup is only a thirty-three percent margin. Pricing to a markup while reporting to a margin, or the reverse, quietly destroys profitability, so the calculator always shows both together.
A 50 percent markup is a 33.3 percent margin, and pricing to one while reporting the other destroys profitability quietly.
Divide cost by one minus the margin — not add the percentage to cost, which is the common and costly error.
Work from whichever figures you actually have rather than a fixed input order.
Direct costs only, kept distinct from net margin which absorbs overheads and tax.
Change any value and the rest follow, which makes it usable as a pricing scratchpad.
Cost, revenue, gross profit, margin percentage or markup percentage — any two will do.
Every remaining figure is calculated, including both margin and markup.
Enter your cost and the margin you want to see the price required to achieve it.
Margin and markup are always shown together so the two are never confused.
Margin is profit as a percentage of selling price; markup is profit as a percentage of cost. A product costing 100 and selling for 150 has a 50 percent markup but a 33.3 percent margin. Same profit, different denominator.
Divide the cost by one minus the margin as a decimal. For a 40 percent margin on a 60 cost, divide 60 by 0.6 to get 100. Adding 40 percent to the cost gives 84, which is a common and costly mistake.
It varies enormously by industry. Grocery retail runs on very thin margins with high volume; software can run extremely high. Compare against your own sector rather than a universal figure.
Gross margin counts only the direct cost of goods sold. Net margin subtracts every other expense including overheads, salaries, interest and tax. This calculator works with gross margin.
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