Product Margin Calculation Check

Verify cost and margin arithmetic per item.

Added October 15, 2026. Written with AI assistance and checked for clarity and placeholders; not reviewed by a lawyer, accountant, clinician or other professional. How these prompts are made

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[VERIFY] is an editorial flag, not a blank to fill. Wherever the prompt shows [VERIFY], check that item against a reliable source before you use it (what [VERIFY] means).

Check product margin calculations. Five products with selling price, ingredient or purchase cost, labour, packaging, fees and shipping: [PRODUCT_COSTS]. How I currently calculate margin: [CURRENT_METHOD]. Volume per month: [VOLUMES].

Recalculate gross margin, contribution margin and margin after fees for each product, show the arithmetic, spot costs that are missing, and compare with my stated method. Point out where markup and margin have been confused.

Return a table with Product, Price, Total cost, Margin amount, Margin percent and Note, and a list of cost items to add. Tax and pricing rules are [VERIFY] for [JURISDICTION].

Also suggest how to include wastage, returns and payment fees, and a pricing review date so that cost changes feed through into prices in good time.

No recommendations to buy, sell, borrow or invest. Present scenarios and trade-offs, label estimates, and suggest the questions I should take to a licensed adviser or accountant.

Close with a short message I could send to the person responsible for the next step, asking for what is needed in a polite and specific way.

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Recalculation (invented candle shop)
Candle A: price 24; wax, wick, jar 6.20; labour 3.00; packaging 1.10; payment fee 0.72 (3%); shipping paid 0. Total cost 11.02. Margin 12.98; 54.1%. Markup on cost 117.8%.
Candle B: price 18; costs 9.40; fee 0.54; total 9.94; margin 8.06; 44.8%.
I had calculated "50% margin" for both by halving the price; B is below that.
Missing costs: returns allowance (2% of price), wastage 4% of wax.
After allowing 2% returns: A margin 12.50 (52.1%).
Action: raise B to 20 or reduce cost; review monthly.

• audit