Calculating markups and discounts, calculating value-added tax (VAT) in the Philippines, Calculating profit or loss in Absolute and percentage terms

Markup

is applied to generate profit by adding a specific amount to the cost price of a product to determine its selling price, while a discount is a reduction from the original price intended to persuade consumers to purchase the goods or services.

Cost Price

is the original amount paid to acquire a product for resale

Selling price

Is the amount at which a product is sold to customers

Markup rate

Is the percentage added to the cost price of a product set the selling price and make a profit

List price

Is the original price of the product or service before any discount is applied

Discount rate

is the percentage decrease from the list price

Net price

Is the final amount a customer pays after the discount has been subtracted from the list price.

Value-added tax (VAT)

As a form of indirect tax on consumption. It is composed of the sale, barter, exchange, or lease of goods, properties, and services in the Philippines, as well as the importation of goods into the country.

12%

The tax rate on sale of services and use or lease of properties

Profit

occurs when the selling price (or total revenue) is greater than the cost price (or cost expenses)

Loss

Occurs when the selling price or revenue is less than the cost price or expenses