Markup Calculator
Use your own numbers after reviewing the formula and worked example.
Quick answer
Markup measures profit relative to cost; margin measures profit relative to selling price.
Formula or method
Keep units, percentages and time periods consistent. The formula is useful as a transparent check on the calculator result and helps explain why changing one input changes the answer.
Step-by-step
- Find cost and selling price.
- Subtract to get gross profit.
- Divide profit by cost for markup.
- Divide profit by price for margin.
Worked example
If cost is $60 and price is $100, profit is $40, markup is 66.67% and margin is 40%.
How to interpret the result
Confusing the two can cause underpricing because a target margin requires a larger markup percentage.
When the answer is used for a purchase, loan, payroll decision, construction order, school grade, health estimate or other real-world choice, verify the assumptions that matter in that context. Accurate arithmetic still depends on accurate inputs.
Common mistakes
- Using cost as denominator for both.
- Assuming 50% markup equals 50% margin.
- Ignoring other costs when interpreting profit.
Frequently asked questions
Can markup exceed 100%?
Yes.
Can ordinary positive margin exceed 100%?
No.
How do I price for a target margin?
Price = cost ÷ (1 − target margin).