**MARGIN**

Margin is often expressed as a specific percentage (similar to markup). However, margin uses price as the divisor. If we want to calculate the margin on the Part, here is what that looks like:

EXAMPLE

If Price = $1,200 and

Cost = $500

**MARKUP**

You can think of markup as the extra percentage that you charge your customers (on top of your cost). The markup formula looks like this:

## An example of using the markup formula

If

Cost = $500 and

Price = $1,200

Markup = 1.4

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