Profit Percentage Calculator: Easily Determine Your Business Profitability
Profit percentage equals your total profit divided by cost price, multiplied by 100. For instance, earning $1,500 on a $6,000 cost delivers a 25 % margin. Average net profit margin for U.S. small businesses is just 7 % (Guidant Financial Small Business Trends 2023).
Profit Percentage Calculator
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How to use the tool
Enter Total Profit: Type the money you gained after expenses. Example 1: $1,500. Example 2: $2,000.
Enter Cost Price: Type what you spent to make or buy the item. Example 1: $6,000. Example 2: $4,500.
Press “Calculate”: The tool divides profit by cost, then multiplies by 100 to show your percentage.
Read the Result: You see profit, cost, and profit % side-by-side for quick comparison.
The tool shows how much profit you earn for every dollar spent, expressed as a percentage (Investopedia, url).
How is profit percentage different from markup?
Profit % uses cost as the base; markup uses selling price. A 50 % profit equals a 33 % markup (Investopedia, url).
Can a result be negative?
Yes—negative profit means a loss, signalling you sold below cost (Damodaran Margins 2023).
How often should you check profit percentage?
Run monthly or per product launch to spot margin trends quickly (Guidant Financial 2023).
What margin counts as “good”?
Many analysts call 20 % healthy and 30 % excellent, but compare against your industry average (Damodaran 2023).
Does currency affect the formula?
No—the ratio stays the same. Just use the same currency for both inputs (IRS Pub 334 2022).
Why use a calculator instead of spreadsheets?
It cuts setup time, removes formula errors, and displays instant results on any device (Investopedia, url).
How can you raise your profit percentage?
Increase prices, cut direct costs, or boost efficiency; “Margin analysis highlights whether operations generate adequate returns on invested capital” (OECD TP Guidelines 2022).
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