How To Split Profit Margin Into 5 Slices

Oct 17, 2013

This is the Case:

I Produce something with a €2000 cost price. this is variable.

I Sell it for lets say € 2500,- to someone this is also a variable.

That's makes a Profit of € 500,- on the sale. This is 125% revenue

Until here, no problem using a spreadsheet. but now the difficult part.

I have to split of the 25% margin over 2 persons. This has to be done as follow:

a. The first slice is 2,25 for Mr A
b. The second slice is 15,00 for MR B
c. The Third Slice is 2,75 for mr A

This divides 20 of the 25 % over 2 persons. Still 5% margin remains

The last 5 is devided as follow:
d. 85% for MR A
e. 15% for MR B

So in this case:
MR A receives: a:€45 + c:€55+ d:€85 = €185,-
MR B receives: b:€250 + e:€15 = €265,-

The tricky part is when the margin is less than 20%.
for example; If the margin is 14%. than only slice a. and a part of slice b. an be paid off. so in that case;
MR A receives: a:€45 + c:€0+ d:€0 = €45,-
MR B receives: b:€230 + e:€0 = €230,-

Any formula which calculates the revenue for MR A and B automatically based on only the cost and selling price.

A B
1 Cost price - €2000
2 Selling Price - €2500
3 MR A - €185,-
4 MR B -€265,-

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