Stuart Kelly » Mathematics http://blogs.fashione.co.uk/stuart Development, websites, EPOS and customer support Fri, 11 Jun 2010 08:02:36 +0000 http://wordpress.org/?v=2.9.2 en hourly 1 Percentage Profit Margin http://blogs.fashione.co.uk/stuart/2008/08/percentage-profit-margin/ http://blogs.fashione.co.uk/stuart/2008/08/percentage-profit-margin/#comments Fri, 01 Aug 2008 12:51:49 +0000 admin http://blogs.fashione.co.uk/stuart/?p=22 The percentage profit margin is calculated as follows.

Variables
CostPrice   = 10.00
RetailPrice = 20.00
VATRate     = 17.5%
Calculate BeforeVAT
BeforeVAT = RetailPrice / ( 1 + (VATRate/100))
BeforeVAT = 20.00 / ( 1 + (17.5/100))
BeforeVAT = 17.02128
Calculate Profit
Profit = BeforeVAT - CostPrice
Profit = 7.02128
Calculate Percentage Profit Margin
PerProfit = (Profit / BeforeVAT) * 100
PerProfit = (7.02128 / 17.02128) * 100
PerProfit = 0.4125 * 100
PerProfit = 41.25%

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