The contribution margin formula is used to calculate contribution margin. Contribution margin is the difference between the revenue and the variable costs of a business.
Weighted Average Unit Contribution Margin
The weighted average units contribution margin is used in a multiple product business to calculate the contribution margin per unit for a given sale percentage mix. The concept is useful for establishing the break even point in units.
Average Gross Margin Calculator
This average gross margin calculator will help you to estimate the weighted average gross margin for a business. Normally a business will have a number of product lines and know the gross margin on each, to calculate the average gross margin for the business it is necessary to weight each product margin by its corresponding revenue.
Margin vs Markup Tables
The margin vs markup tables below act as a quick reference to help you calculate markup and cost multipliers from a know margin. The values are based on the margin to markup formula as follows:
Margin Markup Calculator and Converter
The Excel sheet, available for download below, helps a business convert from margin to markup or from markup to margin, and also calculates the cost multiplier which can be used to apply to a cost price to calculate the corresponding selling price.
Markup vs Margin
Markup and margin are two ways of looking at the same thing depending on whether your starting point is cost or selling price for a product. Quite simply, markup is profit divided by the cost price, and margin is profit divided by the selling price.
It is often useful to be able to convert between markup and margin and to calculate the selling price, cost price and profit of a product in different circumstances.
The Excel sheet, available for download below, helps a business calculate selling price, cost price, profit, markup, margin, and cost multiplier by knowing and inserting two of the values.
Gross Profit Formula – How is it used?
The gross profit formula is used to calculate gross profit. Gross profit, sometimes referred to as gross margin, is the difference between the revenue and the cost of goods sold for a business.