Profit & Loss

JV Global Services LLP (Naxeva Group) – Student handout
PROFIT AND LOSS

Profit and loss questions are concerned with determining the price of a commodity in the market and
understand how profitable a business is.
Cost Price (CP): The price at which an article is purchased.
Selling Price (SP): The price at which an article is sold.
Profit (P): If selling price is greater than Cost price, then the seller is said to have a Profit or Gain.
Profit = Selling Price – Cost Price
Profit Percentage and loss percentage:
Profit (Gain)%: The percentage value of profit or gain.
Profit
Profit % = × 100
C. P
Loss %: The percentage value of profit or gain.
Loss
Loss % = × 100
C. P
Formula to find Selling price:

100+Profit %
1. S.P = 100
× C. P
100−Loss %
2. S.P = × C. P
100
Formula to find Cost price:
100
1. C.P = × S. P
100+Profit %
100
2. C.P = 100−Loss % × S. P
Marked price (MP): This is the price marked as the selling price on an article, also known as the listed
price, labelled price, tag price etc.
Discount (D): This is the reduction in price offered on the marked price.
Discount = Marked Price – Selling Price
(MP−SP)
D% = M.P
x 100
(D%)
D= x MP
100
If a product is sold at 25% profit, then the selling price, SP = 125% of CP (or) 1.25 CP
If a product is sold at 15% loss, then the selling price, SP = 85% of CP (or) 0.85 CP
When a person sells two similar products, one at a gain of x%, and the other at a loss of x%, then the seller
Common loss and profit % 2 x 2
always incurs a loss given by: Loss % = ( 10
) = (10)
If a seller proposes to sell his goods at cost price, but uses false weights,
Error
Profit% = ( x 100)%
True value−Error
Exercise problems:
1. A book is bought for Rs.900 and sold for Rs.1080, find the gain percent?
a.16 2/3% b. 20% c. 18% d. 25%
1. The cost price of a radio is Rs.1500 and it was sold for Rs.1230, find the loss %?
a. 18% b. 9% c. 12% d. 6%
2. A watch was sold at a loss of 10%. If it was sold for Rs.140 more, there would have been a gain of 4%.
What is the cost price?
a. Rs.1000 b. Rs.1400 c. Rs.900 d. 860
3. A single discount equivalent to the discount series of 25%, 10% and 5% is?
a. 25% b. 30% c. 35.8% d. 31.6%
JV Global Services LLP (Naxeva Group) – Student handout
4. A trader bought a car at 20% discount on its original price. He sold it at a 40% increase on the price he
bought it. What percent of profit did he make on the original price?
a. 10% b. 15% c. 11% d. 12%
5. A girl bought horse and carriage for Rs. 5000. She sells the horse at a gain of 20% and the carriage at
a loss of 10%. If she gains 3% on the whole, then find the cost of the horse.
a. Rs.2170 b. Rs.2400 c. Rs.2315 d. 2600
6. A dishonest merchant sells his grocery using weights 15% less than the true weights and makes a
profit of 20%. Find his total gain percentage.
a. 40.7% b. 57.32% c. 41.7% d. 49%
7. Bhima Jewelers offers the following discount scheme for buyers on a gold coin
Scheme 1-two successive discount of 12%
Scheme 2-a discount of 14% followed by a discount of 11%
Scheme 3-two successive discount of 15% and 5%
Scheme 4- two successive discount of 15% and 20%
The selling price will be minimum under which scheme?
a. Scheme 1 b. Scheme 2 c. Scheme 3 d. Scheme 4
8. In order that there may be a profit of 30% after allowing a discount of 20% on the marked price, the
cost price of an article has to be increased by what percentage?
a. 62 1/2% b. 63% c. 72% d.702/3 %
9. A Shopkeeper sells laptops at the rate of Rs 457 each and earns the commission of 4%. He also sells
Mobile phones at the rate of Rs 80 each and earns a commission of 20%. How much amount of
commission will he earn in two weeks if he sells 10 laptops and 6 mobile phones per day?
a. Rs.270 b. Rs.398.50 c. Rs.399.80 d. None of these
10. A shopkeeper offers a discount of 20% on the selling price. On a special sale day, he offers an extra
25% off coupon after the first discount. If the article was sold for Rs. 3600, find
i. The marked price of the article and
ii. The cost price if the shopkeeper still makes a profit of 80% on the whole after all discounts are
applied.
a. Rs.6000, Rs.2000 b. Rs.8000, Rs.2500 c. Rs.3000, Rs.2800 d. Rs.3500, Rs.3000
11. After selling a watch, Mahesh found that he had made a loss of 12 %. He also found that had he sold
it for Rs. 45 more, he would have made a profit of 8 %. The actual initial loss was what percentage of
the profit earned, had he sold the watch for 8 % profit?
a. 66.67% b. 150% c. 145% d. 180%
12. In a transaction, the profit percentage is 80% of the cost. If the cost further increases by 20% but the
selling price remains the same, how much is the decrease in profit percentage?
a. 30% b. 35% c. 47% d. 45%
13. What is the maximum percentage discount (approximately) that a merchant can offer on his marked
price, so that he ends up selling at no profit or loss, if he initially marked his goods up by 40%?
a. 33.4% b. 28.5% c. 43.9% d. 62%

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JV Global Services LLP (Naxeva Group) – Student handout

PROFIT AND LOSS

Formula to find Selling price:

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