Gross Profit Calculator: Margin, Markup & Profit Online
Calculate gross profit dollars, gross margin percentage, and markup.
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How to Use the Gross Profit Calculator: Margin, Markup & Profit Online
- 1Enter total revenue (selling price).
- 2Enter Cost of Goods Sold (COGS).
- 3View gross profit dollars, gross margin %, and markup %.
- 4Experiment with target prices to hit desired profit margins.
Formula & How It Works
Gross Profit & Margin Formulas
Gross Profit = Revenue - COGS. Margin % = (Profit / Revenue) * 100. Markup % = (Profit / COGS) * 100.
Worked Examples
Retail Product Sale
Input: Revenue: $100, COGS: $60
Explanation: $40 profit is 40% of revenue and 66.67% above cost.
High Margin Software
Input: Revenue: $500, COGS: $50
Explanation: High gross margin SaaS product.
Low Margin Wholesale
Input: Revenue: $1,000, COGS: $850
Explanation: High-volume wholesale margin.
Frequently Asked Questions
What is the difference between margin and markup?▼
Margin is profit divided by selling price (revenue); markup is profit divided by cost (COGS).
How do you calculate gross profit?▼
Gross Profit = Total Revenue - Cost of Goods Sold (COGS).
What markup gives a 50% profit margin?▼
A 100% markup on cost results in a 50% profit margin (e.g. cost $50, markup $50, sell for $100).
What is Cost of Goods Sold (COGS)?▼
COGS includes the direct costs of producing goods or acquiring inventory (raw materials and direct labor).
Why is gross margin important?▼
Gross margin shows how efficiently a company produces revenue before covering overhead and fixed expenses.
Is this tool free and private?▼
Yes, financial figures are calculated in your browser and never sent to a server.
Quick Reference & Conversion Table
| Cost (COGS) | Selling Price | Gross Profit | Gross Margin | Markup |
|---|---|---|---|---|
| $50 | $100 | $50 | 50.0% | 100.0% |
| $60 | $100 | $40 | 40.0% | 66.7% |
| $75 | $100 | $25 | 25.0% | 33.3% |
| $80 | $100 | $20 | 20.0% | 25.0% |
⚠️ Common Pitfalls to Avoid
- •Confusing profit margin with markup percentage (a 50% markup yields a 33.3% margin).
- •Including operating expenses (overhead/rent) in COGS instead of direct production costs.
💡 Practical Real-World Uses
- •Setting retail product pricing to achieve healthy gross profit targets.
- •Analyzing company income statements and quarterly financial filings.
- •E-commerce store inventory margin auditing.
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