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Posted by John

Formulas and calulcations for margin, markup and cost price

Formulas and calulcations for margin, markup and cost price

Here's a list of basic formulas and calculations (unrounded) that could come in handy for spreadsheet programmes such as excel.

We use the following formulas to do forward and reverse calculations on things such as retail inc VAT price given the cost price and retail margin and visa versa.

* Calculate ex VAT from cost price and margin

ExVAT = CostPrice / (100 - Margin) * 100

* Calculate margin from ex VAT and cost price

Margin = ((ExVAT - CostPrice) / ExVAT) * 100

* Calulate margin from markup

Margin = (1 - (1 / ((Markup / 100) + 1))) * 100

* Calculate markup from margin, ex VAT and cost price

Markup = ((Margin * ExVAT) / CostPrice)

* Calculate markup from margin

Markup = (Margin) / (1 - (Margin / 100))

* Calculate inc VAT from cost price, margin and tax rate

IncVAT = (CostPrice / (100 - Margin) * 100) * (1 + (TaxRate / 100))

* Calculate cost price from ex VAT and margin

CostPrice = ExVAT * ((100 - Margin) / 100)

* Calculate margin from cost price and Inc VAT price

Margin = (1 - (CostPrice / (IncVATPrice / (1 + (TaxRate / 100))))) * 100

If you'd like more please post your request with details.


Happy to help - John (Easify Support)

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Posted by Rickyk

Re: Formulas and calulcations for margin, markup and cost pr

The formulas are fantastic - many thanks.

I am a newbee to easify, just a stupid question regarding VAT and mark-ups, etc. My suppliers all provide pricing in their catalogues excluding VAT. My company isn't yet registered for VAT, so for the purposes of Easify, do I add the VAT to the cost price. To explain...

a bag costs me £9.99 + VAT (= £11.99) which I am going to sell for £17.99 therefore a £6.00 profit. Do I enter into the system the cost price as £9.99 or £11.99?

My suppliers have sent me nice spreadsheets which I can simply upload, but all of their pricing doesn't include VAT.

or am I completely missing the point?

Posted by Richard

Re: Formulas and calulcations for margin, markup and cost pr

Hi Rickyk - welcome to the forums  

If you're not registered for VAT, you have to still pay it to your suppliers, but you aren't allowed to claim the VAT back from HMRC, and you aren't allowed add VAT onto your prices to charge your customers.

So you would need to enter the cost price of the item as the cost price + VAT, or in other words you'd enter the cost price as £11.99 and not £9.99.

We've got a FAQ here http://www.easify.co.uk/forums/viewtopic.php?f=6&t=15 that shows how to add extra columns to your import file. You could add an extra column and use one of the formulas above to calculate the sell price.

HTH


Regards - Richard (Easify Developer)

Posted by Rickyk

Re: Formulas and calulcations for margin, markup and cost pr

Great Thanks for that!  

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