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How to Calculate Profit Margin
Formula
Profit margin is the percentage of revenue that is profit, calculated as (Revenue - Cost) / Revenue.
Understanding the difference between margin and markup is crucial for pricing and profitability analysis.
Common use cases:
- Pricing decisions
- Profitability analysis
- Comparing margin vs markup
Frequently Asked Questions
Emily Taylor
Certified Public Accountant, CPA, MBA
Emily is a Certified Public Accountant with an MBA in Finance. She has over 10 years of experience in tax planning, business accounting, and personal finance advisory. She develops practical financial tools for everyday money management.
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