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Body Mass Index (BMI) is a number calculated from a person's weight and height. BMI is a reliable indicator of body fatness for people. BMI does not measure body fat directly, but research has shown that BMI correlates to direct measures of body fat, such as underwater weighing and dual energy x-ray absorptiometry (DXA).1, 2 BMI can be considered an alternative for direct measures of body fat. Additionally, BMI is an inexpensive and easy-to-perform method of screening for weight categories that may lead to health problems

BMI is calculated the same way for both adults and children. The calculation is based on the following formulas

Kilograms and meters (or centimeters)
Formula: weight (kg) / [height (m)]2
With the metric system, the formula for BMI is weight in kilograms divided by height in meters squared. Since height is commonly measured in centimeters, divide height in centimeters by 100 to obtain height in meters.

Example: Weight = 68 kg, Height = 165 cm (1.65 m)
Calculation: 68 ÷ (1.65)2 = 24.98

Pounds and inches
Formula: weight (lb) / [height (in)]2 x 703
Calculate BMI by dividing weight in pounds (lbs) by height in inches (in) squared and multiplying by a conversion factor of 703.

Example: Weight = 150 lbs, Height = 5'5" (65")
Calculation: [150 ÷ (65)2] x 703 = 24.96

The standard weight status categories associated with BMI ranges for adults are shown in the following:

Underweight = <18.5
Normal weight = 18.5-24.9
Overweight = 25-29.9
Obesity = BMI of 30 or greater

Source:
http://www.nhlbisupport.com/bmi/
http://www.cdc.gov/healthyweight/assessing/bmi/adult_BMI/in
dex.html