What is a 25% markup on a $40 cost?
A 25% markup on $40 gives a $50 selling price, $10 profit, and a 20% profit margin.
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Markup and margin are different percentages. The breakdown keeps both visible.
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Markup measures profit as a percentage of cost. Margin measures profit as a percentage of the selling price. They are related, but they are not the same percentage.
Markup % = (profit ÷ cost) × 100
Margin % = (profit ÷ selling price) × 100
Subtract the cost from the selling price to find your profit, divide the profit by the cost, then multiply by 100.
Example: you buy a product for $40 and sell it for $60. Profit is $60 − $40 = $20. Markup is $20 ÷ $40 × 100 = 50%. Margin is $20 ÷ $60 × 100 = 33.33%.
Multiply the cost by one plus the markup percentage: Selling price = cost × (1 + markup % ÷ 100). For an $80 cost and a 30% markup, the selling price is $80 × 1.30 = $104.
Because margin is based on the selling price, it is always lower than the equivalent positive markup.
| Markup | Margin |
|---|---|
| 10% | 9.09% |
| 20% | 16.67% |
| 25% | 20% |
| 30% | 23.08% |
| 50% | 33.33% |
| 75% | 42.86% |
| 100% | 50% |
To convert yourself: Margin % = markup ÷ (100 + markup) × 100, and Markup % = margin ÷ (100 − margin) × 100.
A 25% markup on $40 gives a $50 selling price, $10 profit, and a 20% profit margin.
No. A 50% markup converts to a 33.33% margin. A 50% margin requires a 100% markup.
Yes. A negative result can be mathematically valid when the selling price is below cost. The calculator shows a warning instead of treating that situation as an input error.