Mark up and Margin

troy

Would someone please explain how to work out Mark up and Margin please?
I know i should have learnt this at Intermediate level but i just couldn't get my head around it :huh:

jh999

Mark up is an increase above cost price. ie If it costs £1, a 50% markup will lead to a selling price of £1.50.

Margin is a proportion of selling price. ie If it sells for £1, a 50% margin means it cost 50p to make.

I believe that's correct, but it may be a little simplistic.

jay cutler

I believe as formulas:

Gross Profit Margin = Gross Profit/Sales x 100%

Gross Profit Mark up = Gross Profit/Cost of Sales x 100%

where Gross Profit = Sales - Cost of Sales