Gross Margin Calculator
Calculate gross profit and gross margin from revenue and cost of goods sold.
What the Gross Margin Calculator does
Gross margin measures what proportion of revenue survives the direct cost of producing it. It is the single most diagnostic number in a business: it determines how much is available to cover overheads and still leave a profit.
Formula
Gross profit = Revenue − COGSGross margin % = Gross profit ÷ Revenue × 100Markup % = Gross profit ÷ COGS × 100
Inputs explained
| Input | Unit | Required | Notes |
|---|---|---|---|
| Revenue | selected currency | Yes | Accepts more than 0. |
| Cost of goods sold | selected currency | Yes | Accepts 0 or more. |
| Units sold | number | Optional | Optional — shows per-unit figures. Accepts 0 or more. |
| Currency | one of 10 options | Optional | — |
How to use it
- Choose Currency.
- Enter Revenue and Cost of goods sold.
- Optionally add Units sold.
- Select Calculate.
Worked example
$800,000 revenue with $320,000 of direct costs.
- Revenue
- 800000
- COGS
- 320000
Gross profit $480,000, a 60% gross margin and a 150% markup on cost.
Frequently asked questions
What belongs in COGS?
Only costs that scale directly with production — materials, direct labour, shipping, payment processing, hosting for a per-customer service. Rent and salaries for general staff are operating expenses.