Not tax, legal, or accounting advice — the published math, with its source.
LBTN

Glossary

Markup

Profit expressed as a share of the cost rather than of the price.

Markup is the amount added to cost to arrive at a price, as a percentage of that cost. It is always a larger percentage than the corresponding margin, and the two diverge quickly: a 50% margin is a 100% markup, and a 75% margin is a 300% markup. Trades and wholesalers usually quote markup because they start from a cost; retailers and service businesses usually quote margin because they start from a price. Problems arise when a target stated in one is applied as though it were the other.

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