Enter the target profit margin (%) and the price of one unit ($) into the calculator to determine the Desired Profit.
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Desired Profit Formula
The following formula is used to calculate the Desired Profit.
DP = TPM/100 * UP
- Where DP is the Desired Profit ($)
- TPM is the target profit margin (%)
- UP is the price of one unit ($)
To calculate the desired profit, multiply the target margin by the price of one unit.
How to Calculate Desired Profit?
The following example problems outline how to calculate Desired Profit.
Example Problem #1:
- First, determine the target profit margin (%). In this example, the target profit margin (%) is given as 40.
- Next, determine the price of one unit ($). For this problem, the price of one unit ($) is given as 200.
- Finally, calculate the Desired Profit using the equation above:
DP = TPM/100 * UP
The values given above are inserted into the equation below:
DP = 40/100 * 200 = 80 ($)
Example Problem #2:
The variables needed for this problem are provided below:
target profit margin (%) = 35
price of one unit ($) = 150
Entering these values and solving gives:
DP = 35/100 * 150 = 52.5 ($)
