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Get profit margin percentage

Excel formula: Get profit margin percentage
Generic formula 
=(price-cost)/price
Summary 

To calculate profit margin as a percentage with a formula, subtract the cost from the price and divide the result by the price. In the example shown, the formula in cell D5 is:

=(B5-C5)/B5
Explanation 

Profit margin is a ratio of profit divided by price, or revenue. In the example shown, we are calculating the profit margin for a variety of products or services. For each item, we have price and cost, but profit is not broken out separately in another column.

To calculate profit margin, we must first subtract the cost from the price to get profit. Then we divide the result by the price. In the example shown, the first formula in D5 is:

=(B5-C5)/B5

Make sure you use parentheses to control the order of operations.

Note that the result will be a decimal number like .10, .25, .30, etc. To display the result as a percentage, apply Percentage number format. You can use the shortcut Control + Shift + %.

Author 
Dave Bruns

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