Profit Margin worksheet

1. Required selling price: $81.08

1. Turn the target margin into a decimal

   $\frac{\mathrm{26\%}}{100}$$=0.26$

2. The cost must make up the rest of the price, so divide the cost by 1 minus the margin

   $\frac{\mathrm{\$60.00}}{1-0.26}$$=\mathrm{\$81.08}$

3. Take the cost away from the price to get the gross profit

   $\mathrm{\$81.08}-\mathrm{\$60.00}$$=\mathrm{\$21.08}$

4. For comparison, markup divides the same profit by the cost instead of the price

   $\frac{\mathrm{\$21.08}}{\mathrm{\$60.00}}\times 100$$=\mathrm{35.1351\%}$

2. Required selling price: $65.00

1. Turn the target margin into a decimal

   $\frac{\mathrm{20\%}}{100}$$=0.2$

2. The cost must make up the rest of the price, so divide the cost by 1 minus the margin

   $\frac{\mathrm{\$52.00}}{1-0.2}$$=\mathrm{\$65.00}$

3. Take the cost away from the price to get the gross profit

   $\mathrm{\$65.00}-\mathrm{\$52.00}$$=\mathrm{\$13.00}$

4. For comparison, markup divides the same profit by the cost instead of the price

   $\frac{\mathrm{\$13.00}}{\mathrm{\$52.00}}\times 100$$=\mathrm{25\%}$

3. Gross margin: 52.17%

1. Take the cost away from the selling price to get the gross profit

   $\mathrm{\$115.00}-\mathrm{\$55.00}$$=\mathrm{\$60.00}$

2. Divide the profit by the selling price, then multiply by 100, to see what share of each sale you keep

   $\frac{\mathrm{\$60.00}}{\mathrm{\$115.00}}\times 100$$=\mathrm{52.1739\%}$

3. For comparison, find the markup: the same profit as a share of the cost

   $\frac{\mathrm{\$60.00}}{\mathrm{\$55.00}}\times 100$$=\mathrm{109.0909\%}$

4. Gross margin: 40%

1. Take the cost away from the selling price to get the gross profit

   $\mathrm{\$120.00}-\mathrm{\$72.00}$$=\mathrm{\$48.00}$

2. Divide the profit by the selling price, then multiply by 100, to see what share of each sale you keep

   $\frac{\mathrm{\$48.00}}{\mathrm{\$120.00}}\times 100$$=\mathrm{40\%}$

3. For comparison, find the markup: the same profit as a share of the cost

   $\frac{\mathrm{\$48.00}}{\mathrm{\$72.00}}\times 100$$=\mathrm{66.6667\%}$

5. Gross margin: 40%

1. Take the cost away from the selling price to get the gross profit

   $\mathrm{\$90.00}-\mathrm{\$54.00}$$=\mathrm{\$36.00}$

2. Divide the profit by the selling price, then multiply by 100, to see what share of each sale you keep

   $\frac{\mathrm{\$36.00}}{\mathrm{\$90.00}}\times 100$$=\mathrm{40\%}$

3. For comparison, find the markup: the same profit as a share of the cost

   $\frac{\mathrm{\$36.00}}{\mathrm{\$54.00}}\times 100$$=\mathrm{66.6667\%}$

6. Gross margin: 58.33%

1. Take the cost away from the selling price to get the gross profit

   $\mathrm{\$120.00}-\mathrm{\$50.00}$$=\mathrm{\$70.00}$

2. Divide the profit by the selling price, then multiply by 100, to see what share of each sale you keep

   $\frac{\mathrm{\$70.00}}{\mathrm{\$120.00}}\times 100$$=\mathrm{58.3333\%}$

3. For comparison, find the markup: the same profit as a share of the cost

   $\frac{\mathrm{\$70.00}}{\mathrm{\$50.00}}\times 100$$=\mathrm{140\%}$

7. Gross margin: 37.93%

1. Take the cost away from the selling price to get the gross profit

   $\mathrm{\$145.00}-\mathrm{\$90.00}$$=\mathrm{\$55.00}$

2. Divide the profit by the selling price, then multiply by 100, to see what share of each sale you keep

   $\frac{\mathrm{\$55.00}}{\mathrm{\$145.00}}\times 100$$=\mathrm{37.931\%}$

3. For comparison, find the markup: the same profit as a share of the cost

   $\frac{\mathrm{\$55.00}}{\mathrm{\$90.00}}\times 100$$=\mathrm{61.1111\%}$

8. Gross margin: 31.82%

1. Take the cost away from the selling price to get the gross profit

   $\mathrm{\$110.00}-\mathrm{\$75.00}$$=\mathrm{\$35.00}$

2. Divide the profit by the selling price, then multiply by 100, to see what share of each sale you keep

   $\frac{\mathrm{\$35.00}}{\mathrm{\$110.00}}\times 100$$=\mathrm{31.8182\%}$

3. For comparison, find the markup: the same profit as a share of the cost

   $\frac{\mathrm{\$35.00}}{\mathrm{\$75.00}}\times 100$$=\mathrm{46.6667\%}$

9. Required selling price: $70.00

1. Turn the target margin into a decimal

   $\frac{\mathrm{20\%}}{100}$$=0.2$

2. The cost must make up the rest of the price, so divide the cost by 1 minus the margin

   $\frac{\mathrm{\$56.00}}{1-0.2}$$=\mathrm{\$70.00}$

3. Take the cost away from the price to get the gross profit

   $\mathrm{\$70.00}-\mathrm{\$56.00}$$=\mathrm{\$14.00}$

4. For comparison, markup divides the same profit by the cost instead of the price

   $\frac{\mathrm{\$14.00}}{\mathrm{\$56.00}}\times 100$$=\mathrm{25\%}$

10. Required selling price: $73.17

1. Turn the target margin into a decimal

   $\frac{\mathrm{18\%}}{100}$$=0.18$

2. The cost must make up the rest of the price, so divide the cost by 1 minus the margin

   $\frac{\mathrm{\$60.00}}{1-0.18}$$=\mathrm{\$73.17}$

3. Take the cost away from the price to get the gross profit

   $\mathrm{\$73.17}-\mathrm{\$60.00}$$=\mathrm{\$13.17}$

4. For comparison, markup divides the same profit by the cost instead of the price

   $\frac{\mathrm{\$13.17}}{\mathrm{\$60.00}}\times 100$$=\mathrm{21.9512\%}$