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Friday, May 13, 2011

Markup Calculation & Formula

Definition: Markup refers to the percentage added to the cost to get the selling price for a product. It can be expressed as a percentage of cost or in dollars.

Formula:
Markup = (Gross profit / Cost of goods sold) * 100%
Or,
Markup Percentage = (Sales Price - Unit Cost) / Unit Cost

Example 1:
Peter bought an item for $23 and sold it for $28. Calculate the percentage markup.
Solution:
Markup

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