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Mark Up
Mark Up
Markup (or price spread) is the difference between the selling price of a
good or service and cost. It is often expressed as a percentage over the
cost. A markup is added into the total cost incurred by the producer of a
good or service in order to cover the costs of doing business and create a
profit. The total cost reflects the total amount of both fixed and variable
expenses to produce and distribute a product.[1] Markup can be expressed
as a fixed amount or as a percentage of the total cost or selling price. [2]
Retail markup is commonly calculated as the difference between wholesale
price and retail price, as a percentage of wholesale. Other methods are
also used.
Markup is a term used to define the difference between the cost of any
good, service, or financial instrument and its current selling price. In other
words, it is the result of subtracting selling price minus cost.