# Contribution to margin movement

by Analyze
Tags: contribution, margin, movement, percentage
 P: 4 I'm stumped at how to approach this problem and was hoping someone could enlighten me. If I had sold $100 of a product and made a 20% profit up until a specific day. The next day, made three sales; A)$20 making a $5 profit B)$50 making a $30 profit C)$30 making a $15 profit. So now, in total, I've sold$200 worth making a total profit $70 or a margin of 35%. The margin delta of 1500 bps, is there a way to show what each sale contributed to that. E.g. A) -300bps B)1000 bps and C) 800bps. I've tried isolating each sale but I don't want order to be a factor. Mentor P: 21,214  Quote by Analyze I'm stumped at how to approach this problem and was hoping someone could enlighten me. If I had sold$100 of a product and made a 20% profit up until a specific day. The next day, made three sales; A) $20 making a$5 profit B) $50 making a$30 profit C) $30 making a$15 profit. So now, in total, I've sold $200 worth making a total profit$70 or a margin of 35%. The margin delta of 1500 bps, is there a way to show what each sale contributed to that. E.g. A) -300bps B)1000 bps and C) 800bps. I've tried isolating each sale but I don't want order to be a factor.
 Math Emeritus Sci Advisor Thanks PF Gold P: 39,361 Contribution to margin movement IF I understand "basis points", then you have "$100 of a product and made a 20% profit", "$20 making a $5 profit" which is 25%, "$50 making a $30 profit" which is 60%, and "$30 making a $15 profit" which is 50%. That is, as you say, a total of$200 dollars sales so a weighted average of the percentage profits, weighted by share of sales, would be $\frac{100}{200}(20)+ \frac{20}{200}(25)+ \frac{50}{200}(60)+ \frac{30}{200}(50)= 10+ 2.5+ 15+ 7.5= 35$. In terms of "percent" that is 10%+ 2.5%+ 15%+ 7.5%= 35%. In terms of "basis points", it is 1000+ 250+ 1500+ 75= 3500. The four sales would be allocated as 1000, 250, 1500, and 75 bps.