formula to calculate dollar value of discounts on revenue

[gsullivan75]

Hi all, I am struggling with working out what should be a simple formula in the yellow cell in the pic below:

To try and explain things:
I know the dollar profit I make is $40
I know that this represents a 40% margin on revenue which has had X value of discounts applied to it (thus the 40% is referred to as 'discounted margin')
I know that I can calculate the discounted revenue that drives this 40% by using the formula $40 / 40% = $100
I know that there was 10%pp (percentage points) of discounts applied
Thus I know that the 'undiscounted margin' is 50%

So now what I now need is a formula that will give me the dollar value of the discounts from either the known 50% Undiscounted GP% or the -10%pp of discounts that will be applied.

What I do know from just playing with numbers is that the Undiscounted Rev needs to be $120 and the discounts thus $20 but I am going slowing mad trying to work this simple formula!!!

All help gratefully received!!
Regards
Gerry

 

[StephenCrump]

Welcome to the Forum!

You've had no answers yet, which suggests that people don't understand the question.

The things you say you "know" are not consistent. If you know:
a) you made $40 profit, and
b) profit was 40% of discounted price

then I agree with you, discounted price must have been $40/40% = $100.

If that discounted price was based on a 10% discount on the original price, then the original price must have been $100/(1 - 10%) = $111.11.

The 40% applies to $100, and the $10% to $111.11, so you can't add 40% + 10% to get 50%.

And it's not clear why the answer needs to be $120?

 

[johnnyL]

I agree the 'known' numbers do not jive.

discount as a percentage 10, discount as dollars 20 would mean a price of $200 was needed.

 

[Saba Sabaratnam]

Your gross profit is $50 per $100 revenue and therefore expense is $50 per $100 revenue excluding 10% discount.

In your example, you made $40 profit after 10% discount and therefore Undisc rev must have been $100 and dic rev $90 ($100 - $10) shown below

$120 revenue will generate $48 profit not $40 as shown below.

Kind regards

Saba