FINBIZTOOLS
Profit Margin Calculator
Calculate profit and margin, or find a price for a target margin.
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Changes the currency symbol and number format only. Amounts are not converted.
How it works
Choose cost and selling price to calculate margin, or enter cost and a desired margin to find the price. Use values for the same item and tax basis.
Formula and methodology
Profit = selling price − cost. Margin (%) = profit ÷ selling price × 100. Reverse price = cost ÷ (1 − margin / 100). Direct mode requires a positive selling price. Reverse mode requires positive cost and a margin below 100%.
Example
Cost ₹80 and selling price ₹100 give ₹20 profit and 20% margin. The same inputs give 25% markup, because markup uses cost as the denominator.
Assumptions and limits
This is gross item margin, not net business profit. Overheads, tax, returns and finance costs are excluded unless incorporated into your inputs. Negative margin is supported within the displayed bounds.
Frequently asked questions
How is margin different from markup?
Margin divides profit by selling price; markup divides it by cost. They are different percentages for the same transaction.
Why is a 100% target margin rejected?
With positive cost, a finite selling price cannot produce a 100% margin.
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Disclaimer
Results are informational estimates based on your inputs. Verify important pricing, tax, accounting and legal decisions with a qualified professional. FinBizTools does not guarantee document validity or financial outcomes.
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Explore this topic
This tool is part of Pricing and Margins.
A common order: work out your margin, set a price from cost, then find the sales volume needed to break even.
- Profit Margin Calculator (this page)
- Pricing Calculator
- Break-Even Calculator
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