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Profit loss

Profit & Loss concept

Concept  | Practice set 1  | Practice set 2

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Profit & loss concept.pdf

Profit & Loss Quizzes

Quiz 1  |  Quiz 2  |  Quiz 3  |  Quiz 4  |  Quiz 5  |

 

 

Important facts and formula of Profit and Loss with Example

profit_loss.

Important facts that you should memorize

Cost Price : The price at which any article is purchased is called its cost price, abbreviated as C.P.

Selling Price : The price, at which an article is sold, is called its selling prices, abbreviated as S.P.

Profit : If Selling Price is greater than Cost Price then seller makes profit.

               Profit = SP – CP

Loss : If Cost Price is greater than Selling Price then seller incurs loss.

Loss = CP – SP

  • If an article is sold at a gain of 50%, than it means  then S.P. = 150% of C.P.
  • If an article is sold at a loss of 40% then S.P. = 60% of C.P.


  
Important Formulae of Profit and Loss

Gain Percentage (Gain %)

Loss Percentage (Loss %) 

Selling Price (S.P.) in case of loss %

Selling Price (S.P.) in case of gain % 

Cost Price (C.P.) in case of gain % 

Cost Price (C.P.) in case of loss % 

Quicker approach for tricky problems/Shortcuts

Rule 1: When a person sells two similar items, one at a gain of say x%, and the other at a loss of x% than theloss incurred by the seller is given by

Loss % =  

Rule 2 : If a trader professes to sell his goods at cost price, but uses false weights, then :

Gain % =        

Rule 3 : If there are two successive profits of R1% and R2% then total profit % =

Rule 4 : If there  is a profit of R1% and loss of R2% then total profit or loss % =

Rule 5 : If the cost price of P article is equal to selling price of Q article where P>Q, then profit % :

Rule 6 : If a person marks his article P% above it’s cost price and gives customers a discount of Q% then net profit of loss % is :

Solved examples on Profit and Loss

Q1. A motorbike vendor recovers the cost of 25 bikes by selling 20 bikes. Find the % profit

(a) 20 %                      (b) 25 %                      (c) 15 %                       (d) 16 %

Solution:

Here in this case price of quantity soled and Cost price are equal, so

Q2. Jethalal bought a Nokia mobile phone @ Rs. 800. He sold it to Master Bhide after allowing a discount of 10%. In this deal, Jethalal made a profit of 12.5%. What was the marked price?

  1. Rs. 1,000
  2. Rs. 1,100
  3. Rs. 1,200
  4. Rs. 1,300

Solution

Profit is always calculated on actual investment (cost price).
Cost Price: Rs.800
The question says, profit =12.5%. What is the profit in rupee terms?

Long cutShortcut
=12.5% x 800
=(125/10)x (1/100) x 800
=Rs. 100
12.5% =1/8 (percentage to fraction conversion table).
So, 12.5% x800
= (1/8) x 800= Rs. 100

Anyways in either method, profit is Rs.100…Fact (i)
Jethalal gave 10% discount on marked price. So customer Bhide Master had to pay only
90% of the Marked Price.
=0.9 times the marked price
=this is the money Jethalal received from customer.

 

Jethalal’s actual profit

=the money he received from customer MINUS his original investment.
=0.9 times Marked price MINUS Rs.800
But recall fact (i), Jethalal’s profit is Rs.100
Therefore
100=0.9 times Marked price – Rs.800
100+800=0.9 times marked price
900=0.9 x MP
MP=900 x 10/9
MP=Rs. 1000.
Final Answer: marked price is Rs.1000

In the exam hall, directly frame the equation: 0.125 x800 =(0.9 xMP)-800

 

Q3. A man buys an article for Rs. 27.50 and sells it for Rs 28.60. Find his gain percent

  • 1%
  • 2%
  • 3%
  • 4%
 

Answer: Option D

Explanation:

So we have C.P. = 27.50
S.P. = 28.60

Gain = 28.60 – 27.50 = Rs. 1.10

Gain%=(GainCost∗100)%=(1.1027.50∗100)%=4%">Gain%=(GainCost100)%=(1.1027.50100)%=4%
 
 
 

Q4. If the cost price is 25% of selling price. Then what is the profit percent.

  1. 150%
  2. 200%
  3. 300%
  4. 350%

Answer: Option C

Explanation:

Let the S.P = 100
then C.P. = 25

Profit = 75

Profit% = 75/25 * 100 = 300

The question given below is a sample practice problem in Profits, Discounts and Markup. It is an Arithmetic Topic and the problem provides an understanding of the core concept related to profits and discounts.

Q5. A merchant marks his goods in such a way that the profit on sale of 50 articles is equal to the selling price of 25 articles. What is his profit margin?

  1. 25%
  2. 50%
  3. 100%
  4. 66.67%

Correct Answer – 100% profit. Choice (3)

Answer with Explanation

Let the selling price per article be = Re. 1
Therefore, selling price of 50 articles = Rs.50

Profit on sale of 50 articles = selling price of 25 articles = Rs.25.
S.P = 50. Profit = 25. Therefore, CP = 50 – 25 = 25.


profit/cp * 100 = 25/25*400 .

Correct answer choice (3)