Formula for cost mark up

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Need anyone's assistance. I need a formula to show a cost mark up of 30%. For example, we have a part for 2.40 and the cost mark up showing in our software is 3.43. Now if you do this calculation on a calculator it comes up with 3.12. Any one with an idea would be wonderful.
 
Lori,

Your calculation of 30% markup from 2.40 to 3.12 it correct. That is Final
Price=(1+markup)*Initial Price.

The software's answer of $3.43 looks to be including a sales or VAT tax?
The total price increase from 2.40 to 3.43 is about 43%.

In any event, your answer of $3.12, excluding taxes is correct.

Regards,
Kevin


Lori said:
Need anyone's assistance. I need a formula to show a cost mark up of 30%.
For example, we have a part for 2.40 and the cost mark up showing in our
software is 3.43. Now if you do this calculation on a calculator it comes
up with 3.12. Any one with an idea would be wonderful.
 
try this
=K5/(1-K6)
where k5 is the cost of 2.40 and k6 is .3

Lori said:
Need anyone's assistance. I need a formula to show a cost mark up of 30%.
For example, we have a part for 2.40 and the cost mark up showing in our
software is 3.43. Now if you do this calculation on a calculator it comes
up with 3.12. Any one with an idea would be wonderful.
 
=A1*(1+0.3)
-----Original Message-----
Need anyone's assistance. I need a formula to show a
cost mark up of 30%. For example, we have a part for 2.40
and the cost mark up showing in our software is 3.43. Now
if you do this calculation on a calculator it comes up
with 3.12. Any one with an idea would be wonderful.
 
Markup can be measured in two ways:

A1: 2.40

Markup on cost:

A2: = A1 * (1+ 30%) ==> 3.12

More common in business, however, is

Markup on sales price:

A2: = A1 / (1 - 30%) ==> 3.43


so that 30% of the sales price is gross margin and 70% is cost.
 
Lori,

Don Guillett and J.E. McGimpsey have the correct answer to why your software
gives a different answer. Please see their answers.

Regards,
Kevin
 
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