Example 1
If selling price is $100 and cost is $80, gross profit is $20 and gross margin is 20%.
Quick Tool Labs
Margin Calculator
Use this margin calculator to estimate gross profit, gross margin percentage, and markup percentage from selling price and cost. It is useful for pricing checks, quote reviews, and product profitability planning.
Calculator
Gross profit$0.00
Margin percentage0.00%
Markup percentage0.00%
Enter selling price and cost to calculate gross margin.
How this margin calculator works
This calculator subtracts cost from selling price to find gross profit. It then divides gross profit by selling price to calculate gross margin percentage and divides gross profit by cost to calculate markup percentage.
Margin % = ((selling price - cost) / selling price) x 100
Gross margin is useful for understanding how much of each sale remains after direct costs. It is often used alongside markup when reviewing pricing decisions.
Examples
Example 2
If selling price is $75 and cost is $50, gross profit is $25 and margin is about 33.33%.
Example 3
If cost is greater than selling price, margin becomes negative and the item is being sold below cost.
Frequently asked questions
Why must selling price be greater than zero?
Margin percentage divides by selling price, so selling price must be greater than zero for the percentage to be defined.
Can margin be negative?
Yes. A negative result means cost is higher than the selling price.
Does this calculator also show markup?
Yes. It shows markup percentage alongside gross margin so you can compare both pricing views.