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Margin on costs - Revision history
2026-05-23T01:36:51Z
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imported>Doug Williamson: Create page. Sources: linked pages.
2019-02-10T14:43:28Z
<p>Create page. Sources: linked pages.</p>
<p><b>New page</b></p><div>''Cost and management accounting''. <br />
<br />
Margin on costs measures the surplus of revenues over relevant costs, in other words profit, expressed as a percentage of costs.<br />
<br />
''Margin on costs = profit '''&divide;''' costs''<br />
<br />
<br />
<span style="color:#4B0082">'''Example 1: Margin on costs'''</span><br />
<br />
Revenues = 100 <br />
<br />
Costs = 70<br />
<br />
<br />
The surplus (profit): <br />
<br />
= 100 - 70 <br />
<br />
= 30.<br />
<br />
<br />
And the margin on costs: <br />
<br />
= profit / costs<br />
<br />
= 30 / 70 <br />
<br />
= '''42.9%'''.<br />
<br />
<br />
''Notice the Margin on costs is different from the conventionally expressed Profit margin, which is the percentage profit expressed as a proportion of revenues, taking the same underlying inputs.''<br />
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<br />
<span style="color:#4B0082">'''Example 2: Profit margin'''</span><br />
<br />
Revenues = 100 <br />
<br />
Costs = 70<br />
<br />
<br />
Surplus (profit): <br />
<br />
= 100 - 70 <br />
<br />
= 30.<br />
<br />
<br />
Profit margin: <br />
<br />
= profit / revenues<br />
<br />
= 30 / 100 <br />
<br />
= '''30%'''.<br />
<br />
<br />
== See also ==<br />
* [[Management accounting]]<br />
* [[Markup]]<br />
* [[Profit margin]]<br />
* [[Profit]]<br />
* [[Profitability]]<br />
<br />
[[Category:Accounting,_tax_and_regulation]]<br />
[[Category:The_business_context]]</div>
imported>Doug Williamson