# Mark up & Margin

kitty
Just JoinedPosts:

**3**Registered
Please can someone help.

I really dont understand these. Please can someone explain.

Thanks:confused1:

I really dont understand these. Please can someone explain.

Thanks:confused1:

kitty
Just JoinedPosts: **3**Registered

Please can someone help.

I really dont understand these. Please can someone explain.

Thanks:confused1:

I really dont understand these. Please can someone explain.

Thanks:confused1:

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## Comments

70Registered3RegisteredThanks

366Registeredmargin -

sales = 100%

margin of profit + cost = 100%

so the cost and margin = sales

eg sales is £100 and margin is 25%

so sales is 100% (£100)

margin is 25% (£25)

cost is 75% (75%)

Mark up

cost = 100

mark up = whatever %

sales = 100 and whatever %

eg cost is £100 and they are marked up by 40 %

40% of 100 is £40

so selling price is 140 % (£140)

cost is 100% (£100)

mark up is 40% (£40)

70RegisteredTotal sales revenue = 18,000 + 60,000 - 78,000

Margin of 25% - Sales revenue of £125,000 - sales = (125,000/125) x 100 = 100,000

366Registeredsomeone else confirm this though please as i have done so much revision i have got to that point when im doubtiing myself.....lol :huh:

3RegisteredI get it now. How daft am I lol.

Just have to remember it now.

Thanks again.:thumbup:

63RegisteredCan someone confirm the below please?

Cost price x mark up % = mark up value

Selling price x Margin % - Margin Value.

Markup/margin - calculation of sales

1) Work out gross profit = Cost of sales x mark up %

2) Work out the sales = Cost of sales + Gross profit

Mark up/Margin - Calculation of purchases

1) Work out gross profit = sales x margin %

2) Work out cost of sales = Sales - gross profit

3) Work out purchases = Cost of sales + closing stock - opening stock.

Mark up is % of sales

Margin is % on cost

This is basically what I have written down in my revision notes. But I don't feel very confident about it. I might feel abit better if someone confirms this is right..... :001_unsure:

This seems to be the hardest part of FRA for me, seriously hoping it's not in the exam this year :crying:

Ta

2RegisteredHi All

OK, lets keep it very simple. There is 2 options.

1) Mark up on cost of sales

2) Profit Margin

Tip, If you remember the bit in red above the rest falls into place.

Explanation:

1)

Cost of sales =100%

+ profit =(eg 20%)

Sales revenue = 120%

2) It has to be different to the one above, therefore.

Sales revenue = 100%

Cost of sales =(eg 20%)

Profit = 80%

Summary, So 'mark up on cost of sales' has cost of sales as 100% the other is the opposite. Hope this helps.

All the best everyone.

459RegisteredGood luck everyone for tomorrow, anyone else taking FRA at LondonSam?