Project Gross Margin Calculator
See what share of a project's revenue survives its delivery cost.
What this calculator does
Margin and markup are reported separately from the same two figures so the two are never confused.
Inputs and what they mean
- Currency
- — Amounts are shown in the currency you pick. No exchange rate is applied..
- Project revenue
- — number value.
- Direct project cost
- — number value.
How to use it
- Enter your own figures — the calculator never fills in a rate, price or benchmark for you.
- Press Calculate to see the result.
- Read the formula, variables, assumptions and source below the result before you rely on it.
Formula
Gross margin = (Revenue − Direct cost) ÷ Revenue; Markup = (Revenue − Direct cost) ÷ Direct cost
Worked example
$120,000 project costing $78,000 to deliver
Margin and markup are shown side by side so they are never confused.
Reading the result
The headline figure is the main answer. Any breakdown underneath shows the parts that make it up, so you can check the working and see what changes when you adjust an input.
Limitations and assumptions
Results depend entirely on the figures you enter and are rounded for display. They are for general information and education, not professional advice.
Reference: Rice University — Principles of Accounting, Volume 2: Managerial Accounting
Last reviewed:
Common questions
Formula, source and verification
Gross profit expressed as a share of revenue, with the markup on cost shown alongside it.
The question it answers: What share of this project's revenue is left after the cost of delivering it?
The formula
Gross margin = (Revenue − Direct cost) ÷ Revenue; Markup = (Revenue − Direct cost) ÷ Direct cost
- R — Project revenue
- (currency). Amount billed or expected for the project.
- C — Direct project cost
- (currency). Cost of delivering the project.
Units: Currency; percentages.
What kind of calculation this is
Deterministic formula. The same inputs always give the same answer. The maths is fixed and does not depend on judgement.
Method
Margin and markup are reported separately from the same two figures so the two are never confused.
Assumptions built into the result
- Mathematical: Revenue and cost cover the same scope.
Figures this calculator will never guess for you
- No industry-average rate, margin, overhead or ticket volume is inserted.
- No optional component is filled in on the user's behalf.
- Margin is never reported as markup or the reverse.
Limitations
- Gross margin ignores overhead and administrative cost; use the net margin calculator for those.
Source and version
- Standard or reference
- Cost accumulation, cost-plus pricing, margin and markup (OpenStax, Principles of Accounting Volume 2: Managerial Accounting — job order costing, cost-plus pricing, margin and markup.)
- Published source
- Rice University — OpenStax (CC BY)
- Formula version
- Version 1
- Verification
- Reviewed against the cited source on
- How much weight the source carries
- Academic
- Applies to
- Currency
- Amounts stay in the currency you choose; no exchange rate is applied.
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