A detailed Explanation how Athmospheres in KSP are working can be found here at the KSP Wiki

To calculate Atmospheric pressure and density in k-OS it can be done in this way:

set atmP to 2.718^((0-altitude)/5000).  // calulates the Atmospheric pressure
set atmD to atmP * 1.2230948554874.     // calulates the Atmospheric density

The 5000 is called the "scale height" and only true for Kerbin:

Body Scale height in m
Jool 10000
Eve 7000
Kerbin 5000
Laythe 4000
Duna 3000

The formula below will give you the force of drag at velocity. You will have to do some additional computation if you want to include a deployed parachute. The cD will change then, it wont be just 0.2.

Fd= 0.5 * atmDensity * (velocity)^2 * 0.2 * (mass*.008).

Thanks for Payload for contributing this information.

Formula for Terminal velocity: To do: Cleaning up the formula.

lock lnc_atm_d to 1.2230948554874 * bi_atm_p0 * (e ^ ((0 - altitude) / bi_atm_sh)).
lock lnc_vt to ((250 * bi_gm) / ((bi_r ^ 2) * vi_grav * lnc_atm_d)) ^ 0.5.

Thanks for HeadChef for contributing this information.