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# Calculations

This article describes how calculations take place in the app along with the formulas.

###### Article Content

1. [Calculations Terms and Formulas](#6-calculations-terms-and-formulas)
2. [Calculations Settings](#6-calculation-settings)

###### Calculations Terms and Formulas

**Gross Sales =** Unit Price * Quantity

**Net Sales =** Gross Sales - Discounts - Tax (if tax settings are turned on)

**Cost Of Items/Cost Of Goods Sold (COI/COG) =** Information fetched from the Cost Of Item field in your Shopify Admin

**Profit (only visible based on calculation settings) =** Net Sales - COI/COG

**Commissions =** (Net Sales (Profit will be used based on calculation settings but Net Sales is used by default) - Deductions  ) * Commissions

**Payouts** = Net Sales (Profit will be used based on calculation settings but Net Sales is used by default) - Commissions

As an example, you can refer to the details below.

**Unit Price for Item A**        = 19.99
**Quantity**                           = 1
**Gross Sales**                     = 19.99 (Unit Price x Quantity) 
**Cost Of Item (COI)**           = 12.00
**Deduction**                        = 5%

**Net Sales = Gross Sales - Discounts - Taxes - Deductions**

|| Only if you have enabled Taxes and Discounts to be calculated in the Gross Sale.  Please check your Settings.

**Net Sales** = 19.99 (Gross Sales) - 5% (0.05) (Deductions) = 18.99

To compute for Profit, we will deduct the COI (Cost of Item) from the Gross Sales

**Profit** =  19.99 (Gross Sale) - 12.00 (COI) = 7.99

To compute for Deductions, we will multiply the Profit with the deduction

**Deduction** = 7.99 (Profit) x 0.05 (Deduction)  = 0.4

To compute for Commissions, we will subtract Deductions from Profit and multiply it by the percentage for commissions (in the next sample, we will use 30%)

**Commissions** = 7.99 (Profit) - 0.4 (Deduction) x 0.3 (30% Commission) = 2.28

To compute for Payouts, we will subtract Deductions from Profit and deduct commission

**Payouts** = 7.99 (Profit) - 0.4 (Deduction) - 2.28 (Commission) = 5.31

###### Calculation Settings

To configure your Calculation settings, please go to **Settings** > **Calculations**.

![Calculations Settings](https://storage.crisp.chat/users/helpdesk/website/-/c/f/9/b/cf9b185a0b087000/calculations_s9lsls.jpg)