Cost of an item given Selling Price of $500 and a 30% Markup on Cost

Given: Selling Price = $500,  Markup = 30%
Markup as a Decimal: 30% = 0.3
Formula:
Cost =  

Selling Price/ 1 + Markup as a Decimal

Cost =  

$500/ 1 + 0.3

Cost =  

$500/ 1.3

Cost = $384.62
Notes:
Markup Amount = Selling Price – Cost = $500 – $384.62 = $115.38
Profit = Markup Amount = $115.38
Profit Margin =  

Profit/ Selling Price

=  

$115.38/ $500

= 0.2308 = 23.08%