Percentages can make a simple pricing question feel slippery. Put the price and costs side by side to see the amount left over and what share of the sale it represents.
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Let’s work it out.
The starting figures are illustrations, not industry benchmarks. Replace them with your own costs and assumptions. Calculations happen in your browser; figures are not saved to your account or sent as analytics properties.
Changes the display label only. It does not convert amounts. Use a consistent basis for tax-inclusive or tax-exclusive figures.
Your planning estimate
- Margin on selling price
- 30%
- Surplus above entered costs
- AUD 150.00
- Selling price
- AUD 500.00
How this calculation works
Selling price minus entered costs gives the surplus. Divide that surplus by selling price and multiply by 100 for margin. The result only covers the costs entered: direct costs give a gross-style margin, while a fuller cost allowance gives a different planning measure.
A little more context: Understand profit and cash flow.
How the calculation works
Selling price minus entered costs gives the surplus. Divide that surplus by selling price and multiply by 100 for margin. The result only covers the costs entered: direct costs give a gross-style margin, while a fuller cost allowance gives a different planning measure.
A worked example you can change
The tool starts with the illustrative figures below. They demonstrate the calculation; they are not industry averages, recommended rates or promises about what you will earn. All monetary figures in this example are AUD.
Selling price: 500 AUD Cost allowance: 350 AUD Margin on selling price: 30% Surplus above entered costs: 150 AUD Selling price: 500 AUD
Make the estimate fit your business work
The most useful estimate is one you can explain. Check these details against the actual job or business arrangement before you rely on the result.
- Use prices and costs on a consistent tax basis.
- Include all relevant costs before treating the result as a business profit measure.
- A negative result is useful information: the entered price does not cover the entered costs.
What this tool does and does not include
The calculation uses the figures you enter and the method above. It does not fetch market rates, convert currencies, assess demand or calculate tax, payroll or legal obligations. Choose a consistent tax basis for the amounts you enter. Changing display currency changes the label only.
Your inputs stay in this browser page and reset when you leave or reload. You can copy or download a text estimate with its assumptions. If you choose to use Lufu, you can then prepare an actual quote or invoice with the details you have agreed.