Mark Up and Margin

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Please can anyone help with mark up and margin. I'm sure that in the exam it is going to ask to calculate the closing stock figure using mark up or margin. I'm finding this quite difficult - anyone else??

Emma

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Mark Up and Margin

    Hi Emma,

    Mark-up
    with this if there is a markup for sales value of 25% for example, this means that the cos against this value will be 100% with a mark-up of 25% to achieve the sales value. So, mark up means sales will be cos =100% + markup% margin to achieve sales value.

    so, if sales are £ 125.00 with a markup of 25%,

    cos = £125.00/125*100 = £100.00 with a margin of £25.00


    profit/sales margin
    profit/sales margin, in this instance sales value will be the 100% figure,
    and cos will be sales 100% - % profit margin of 25% = cos of 75%

    so, if sales are £125.00 with a margin of 25%,

    cos = £125.00/100*75 = £93.75, with a margin of £31.25

    hope this helps - and I haven't confused you further
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Mark Up and Margin

    Hi Ruby

    Thank you for your notes, they are very helpful.

    Em

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