Cost of an item given Selling Price of $187.50 and a 56.25% Markup on Cost

Given: Selling Price = $187.50,  Markup = 56.25%
Markup as a Decimal: 56.25% = 0.5625
Formula:
Cost =  

Selling Price/ 1 + Markup as a Decimal

Cost =  

$187.50/ 1 + 0.5625

Cost =  

$187.50/ 1.5625

Cost = $120
Notes:
Markup Amount = Selling Price – Cost = $187.50 – $120 = $67.50
Profit = Markup Amount = $67.50
Profit Margin =  

Profit/ Selling Price

=  

$67.50/ $187.50

= 0.36 = 36%