Enter the materials cost ($), the labor cost ($), and the desired margin (%) into the Service Price Calculator. The calculator will evaluate and display the Service Price.

## Service Price Formula

The following formula is used to calculate the Service Price.

SP = (MC + L) / (1-DM/100)

- Where SP is the Service Price ($)
- MC is the materials cost ($)
- L is the labor cost ($)
- DM is the desired margin (%)

To calculate a service price, add the material costs and labor costs, then divide by 1 minus the desired margin.

## How to Calculate Service Price?

The following example problems outline how to calculate Service Price.

**Example Problem #1**

- First, determine the materials cost ($).
- The materials cost ($) is given as 250.

- Next, determine the labor cost ($).
- The labor cost ($) is calculated as: 250.

- Next, determine the desired margin (%).
- The desired margin (%) is found to be: 30.

- Finally, calculate the Service Price using the formula above:

SP = (MC + L) / (1-DM/100)

Inserting the values from above yields:

SP = (250 + 250) / (1-30/100) = 714.28 ($)

**Example Problem #2**

The variables needed for this problem are provided below:

materials cost ($) = 50

labor cost ($) = 50

desired margin (%) = 70

This example problem is a test of your knowledge on the subject. Use the calculator above to check your answer.