Formula
Markup is based on cost. If you add 40% markup to a $30 cost, you add $12 and set the price to $42.
Formula: Selling price = cost + (cost × markup percentage)
Business / United States
Markup calculator
Enter cost and markup percentage to calculate selling price, markup amount, and gross margin.
Calculate markup
Markup = cost × markup percentage
What you paid to make or buy the item
How much you want to add on top of cost
Assumptions
- Uses USD for the example
- Cost and markup percentage apply to the same item
- Taxes, shipping, and discounts are excluded unless included in cost
Quick visual
Quick example
A bakery item costs $30 and uses a 40% markup.
Markup amount = 30 × 40% = $12
Selling price = 30 + 12 = $42
Gross margin = 12 ÷ 42 = 28.6%
Common mistakes
- Confusing markup with margin
- Using selling price instead of cost as the starting point
- Forgetting to include overhead or fees in cost
Need help?
Read the full instructions and assumptions for this calculator.