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Thread: Formula for Calculating Sales Margins less all discounts

  1. #1

    Formula for Calculating Sales Margins less all discounts

    I'm looking for the "correct" way to calculate %Margin when there are discount and commission present. Would it be?

    margin = (Revenue-(discounts+commissions))/revenue*100

    Revenue = $2500
    Discounts = $1000
    Commission = $250

    ie.
    (2500-1250)/2500
    Margin = 50%
    ROI = 200%

  2. #2
    Distinguished Lord of VBAX VBAX Grand Master Bob Phillips's Avatar
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    Wouldn't you need initial cost as well to work out the profit?
    ____________________________________________
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  3. #3
    sorry, assume a gross cost basis of 0

  4. #4
    Distinguished Lord of VBAX VBAX Grand Master Bob Phillips's Avatar
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    So

    =(Revenue-(Discounts+Commission))/Revenue

    formatted as a percentage looks about right to me
    ____________________________________________
    Nihil simul inventum est et perfectum

    Abusus non tollit usum

    Last night I dreamed of a small consolation enjoyed only by the blind: Nobody knows the trouble I've not seen!
    James Thurber

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