Formula for calculating Gross Profit with muktiple discounts

Originally Posted by CARM

List Price less Disc1 less Disc2 equals Net Price. Sell price less net
price equal profit divided by sell price equal gross margin percentage.

$10 less 50% less 10% =$4.50. Sell for $12.50. $6.00 less
$4.50 =$1.50. $1.50/6.00 = 25% GP.

All of these figures are in cells of their own. Cannot get this to
calculate correcly.

Please help! Urgent

Following the data that you have, I am just wondering how you arrived at $6 --
which you defined as "Sell Price less net price." Based on your calculations above,

Sell Price = $ 12.50 (given)
Net Price = $ 4.50 (calculated as $10 less 50% less 10%)

Hence, the difference is $8 ($ 12.50 - $ 4.50) and not $6 as you indicated. Unless you can explain how you got $6, I will simply consider this a typo and proceed with deriving the formulas required.

Assume the following entries are in the following cells:

List Price is in Cell A1
Disc1 is in Cell B1
Disc2 is in Cell C1
Net Price is in Cell D1
Sell Price is in Cell E1
Profit ( Sell Price - Net Price ) is in Cell F1
GP percentage is in Cell G1


Your formulas are as follows:

In Cell D1 : =(1-C1)*A1*B1

NOTE: Format Cells C1 and B1 as % and Cell D1 as $

In Cell F1 (formatted as $), =E1-D1

In Cell G1 (formatted as %), =(F1-D1)/F1

The formulas that I have derived are based on the conditions that you stated in your problem. PERSONALLY, I just cannot understand your definition of your GP percentage.

You have the GP percentage calculated as

(Sell Price- Net Price)/Sell Price

but shouldn't you have

(Sell Price- Net Price)/Net Price

as your GP percentage formula?