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Day 5 : Converting between margin and markupDescription: Converting between margin and Markup
Objective: The purpose of this module is to be able to convert between margin and markup, cancel down fractions and round to the nearest whole number.
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Converting between Margin and Markup

John sells a coat with a margin of 20%

What is the percentage markup?

We are told the Margin

– So we work with the selling price

Selling Price = 100% (of the selling price)

Cost Price = 80% (of the selling price)

Profit = 20% (of the selling price)

Markup = Profit / Cost Price (written as a percentage)

= 20% (of the selling price)

80% (of the selling price)

= 0.2 x (Sales Price)

0.8 x (Sales Price)

= 0.2

0.8

= 0.25

= 25%

Converting between Margin and Markup

John sells a coat with a markup of 25%

What is the percentage margin?

We are told the Markup

– So we work with the cost price

Cost Price = 100% (of the cost price)

Selling Price = 125% (of the cost price)

Profit = 25% (of the cost price)

Margin = Profit / Selling Price (written as a percentage)

= 25% (of the cost price)

125% (of the cost price)

= 0.25 x (Cost Price)

1.25 x (Cost Price)

= 0.25

1.25

= 0.2

= 20%