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Gross Profit & Margin from Revenue and Cost

Find gross profit, gross margin, revenue or cost of goods sold, including a zero or negative gross result.

Formula & worked example
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Calculator inputs

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How to use this calculator

Enter the known values in the units shown. Results update as you type.
Where results are editable, change one to solve backwards. Lock a value to hold it fixed.
Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

Revenue of 1,000 and cost of goods sold of 600 give gross profit of 400 and gross margin of 40%.

Gross profit = revenue − cost of goods sold; gross margin = gross profit ÷ revenue

Worked example

Enter these known values and leave the other values blank.

Revenue: 1000 USD
Cost of goods sold: 600 USD

Gross profit: 400 USD
Gross margin: 40 %

Assumptions and limitations

Revenue is positive and cost of goods sold is nonnegative. Use matching periods and accounting classifications.
Gross margin uses revenue as its denominator. Markup uses cost and is a different percentage.
Gross profit excludes expenses not included in cost of goods sold; it is not necessarily net profit.

Common questions

Is gross margin the same as markup?

No. Gross margin divides gross profit by revenue; markup divides it by cost.

Does zero gross profit mean the business breaks even?

Only for the revenue and cost-of-goods-sold comparison. Other expenses can still produce a loss.

References

The calculation equations, inverse formulas, units, and input rules were imported from this source. Bookify provides the interface and equation solver.

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