Free tool · Cash & planning
Profit margin and markup calculator
See gross profit, margin and markup side by side. Use a selling price net of sales tax, discounts and returns, with a consistent definition of direct cost.
Margin and markup use different bases when describing the gap between cost and price.
Visual labels: Margin: price; Markup: cost; Compare carefully.Your scenario
Amounts are displayed in CAD. Keep all inputs on a consistent basis.
- Gross margin
- 40%
- Markup on cost
- 66.7%
Margin divides profit by selling price. Markup divides it by cost. Other operating costs and tax are not included.
Calculated on this device. These inputs are not submitted to Sora.
How the calculation works
Gross profit = selling price − cost. Gross margin = profit ÷ selling price × 100. Markup = profit ÷ cost × 100.
A worked example
A unit costing $60 and selling for $100 produces $40 of gross profit. Its gross margin is 40%, while markup on cost is approximately 66.7%. The same transaction produces different percentages because the denominators differ.
Assumptions and limits
The result is a unit-level gross-profit calculation, not net business profit. Rent, administration, financing and tax are not added automatically. Percentages with a zero denominator are shown as undefined rather than invented. If cost exceeds price, the result correctly shows a loss.
General educational information. Inputs stay on this device and are not submitted. Confirm the assumptions before using a result in a business decision.
Source and further reading
Formula reference checked October 23, 2026: BDC’s financial glossary. The examples above use Sora’s own illustrative figures.
About three minutes
Put the result in context.
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