I am making up a pricing calculator for goods I sell. I want to figure out my margin (Income) after all costs are deducted from sales.
Vat is confusing me.
Say my sales price is 12.30 and includes 2.30 vat
Net sales price is therefore 10.00
Say my cost price is 9.00 and includes 1.68 vat
Net cost price is therefore 7.32
It looks like my income is 10.00 - 7.32 = 2.68
however, I have a vat cost of 2.30-1.68 = .62
**My true income looks like it is 2.68 - .62 = 2.06
**Is this correct and if so, how do I capture this vat 'cost' in my pricing calculator?
Vat is confusing me.
Say my sales price is 12.30 and includes 2.30 vat
Net sales price is therefore 10.00
Say my cost price is 9.00 and includes 1.68 vat
Net cost price is therefore 7.32
It looks like my income is 10.00 - 7.32 = 2.68
however, I have a vat cost of 2.30-1.68 = .62
**My true income looks like it is 2.68 - .62 = 2.06
**Is this correct and if so, how do I capture this vat 'cost' in my pricing calculator?