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Break-Even Calculator Calculate break-even and target-profit unit sales, then test price and cost changes against planned profit and margin of safety.
Markup Calculator Calculate markup and margin from unit costs and selling price, then solve break-even or target list prices with fees, discounts and upward rounding.
Unit Price Calculator Compare two package prices on the same usable unit basis, accounting for multipacks and expected waste plus shared discounts or checkout fees.
Compound Interest Calculator Project compound-interest growth from deposits and a nominal rate, then test how timing, taxes, fees, inflation, and a goal change the outcome.

A sale can produce positive gross profit and still miss the margin needed to support the business. The amount left after direct cost matters, but the denominator determines how that amount is described. Gross margin divides gross profit by revenue. Markup divides the same profit by cost of goods sold (COGS), so the two percentages are not interchangeable.

Suppose an item costs 60 and sells for 100. Gross profit is 40, gross margin is 40%, and markup is 66.67%. Quoting 66.67% as the margin overstates the share of each sales unit that remains after direct cost.

  • Gross profit measures revenue minus COGS.
  • Gross margin shows gross profit as a percentage of revenue.
  • Markup shows gross profit as a percentage of COGS.
  • Modeled net margin also removes entered operating expenses and a revenue-based fee.

Inputs must cover the same scope. Unit selling price belongs with unit cost; monthly revenue belongs with monthly COGS. Mixing periods or omitting returns, fulfillment, waste, direct labor, or marketplace fees can make a precise calculation misleading.

A target margin can be translated into either the revenue needed for a fixed cost or the maximum cost allowed at current revenue. That is useful for pricing and supplier discussions, but it does not prove that demand will support the new price. Volume, discounts, taxes, cash timing, fixed overhead, and working capital remain separate decisions.

Profit labels depend on accounting policy. The result is an educational planning view rather than accounting, tax, or financial advice. Use consistent cost classification and reconcile material decisions with the business's records.

How to Use This Tool:

Calculate one item, order, quote, or reporting period at a time.

  1. Choose the Currency label and enter Revenue greater than zero.
  2. Enter Cost of goods sold for the same scope, then set the Target gross margin you want to compare.
  3. Add Operating expenses and a Revenue fee when you want the modeled net-profit and break-even view. Leave them at zero for a gross-only calculation.
  4. Compare gross margin with markup, then use target revenue or allowable COGS to identify the size and direction of the gap. Check the profit bridge before acting on the modeled net result.

Interpreting Results:

Gross margin answers how much of revenue remains after COGS. Markup answers how much gross profit was added relative to COGS. Markup is undefined when COGS is zero because its denominator would be zero.

A positive Target revenue gap means current revenue is above the revenue required for the entered target. A positive Target cost gap means current COGS is below the maximum allowed at current revenue. Negative values show the shortfall.

Net profit view removes only the operating expenses and revenue fee entered here. It is not a complete income statement. Confirm which expenses, taxes, refunds, discounts, and finance costs are absent before treating the percentage as net margin for the business.

Technical Details:

Let revenue be R, COGS be C, operating expenses be O, target margin as a decimal be t, and the revenue-fee rate as a decimal be f. Currency choice changes labels and formatting only; no exchange-rate conversion occurs.

Formula Core

Gross profit G, gross margin, and markup use related numerators but different denominators:

G=R−C Gross margin percent=100×GR Markup percent=100×GC

Markup is returned only when C is greater than zero. Target planning holds COGS or revenue fixed while solving the margin equation:

Rtarget=C1−t Callowed=R(1−t)

The optional fee is proportional to revenue. Modeled net profit N, net margin, and break-even revenue are:

Fee=Rf N=G−O−Rf Net margin percent=100×NR Rbreak-even=C+O1−f

Break-even algebra treats entered COGS and operating expenses as fixed amounts while the fee varies with revenue. If costs themselves rise with sales, the result will understate the revenue required.

InputAllowed range
RevenueGreater than 0 through 1,000,000,000,000
COGS and operating expenses0 through 1,000,000,000,000
Target gross margin0% through 95%
Revenue fee0% through 95%

Limitations:

The model does not decide which costs belong in COGS or operating expenses. Accounting treatment varies by business and reporting purpose. It also excludes tax, interest, depreciation, inventory timing, discounts, refunds, and any cost not entered.

Target revenue assumes COGS stays fixed while price or volume changes. Break-even revenue assumes entered COGS and operating expenses stay fixed while only the percentage fee scales with revenue. Test alternative scenarios when those assumptions do not match the business.

Worked Examples:

A sale with expenses and a revenue fee

Revenue of €200 and COGS of €100 produce €100 gross profit, a 50% gross margin, and 100% markup. Add €20 of operating expenses and a 10% revenue fee, which is €20, and modeled net profit becomes €60 with a 30% net margin. Holding COGS and operating expenses fixed, break-even revenue is about €133.33.

References: