Profit & Loss
Concept
Profit and Loss is directly related to buying and selling of a product or service. Profit and Loss are computed on the basis of cost or purchase price. If selling price of an item is more than the cost price or production cost, the excess amount is called profit. On the other hand, if cost price or purchase price is more than selling price, the deficit amount is called loss. If a product is labelled or tagged with a price on its packet it is called marked price. Any kind of discount is offered on marked price. To calculate selling price, discount figure is subtracted from marked price.
Tips to solve problems on Profit & Loss:
- Profit = Selling Price-Cost Price/Purchase Price
- Loss = Cost Price/Purchase Price-Selling Price
- Discount =Tagged Price-Selling Price
- Profit Percentage (%) =(Profit/Cost Price) x 100
- Loss Percentage (%) = (Loss/Cost Price) x 100
- Discount Percentage (%) = (Discount/ Tagged Price) x 100
Q. A shopkeeper sells an item at a profit of 20%. If the cost price of the item is 1000, what is the selling price?
A) 900
B) 1200
The cost price of the item is 1000. The shopkeeper sells it at a profit of 20%. Therefore, the selling price of the item is 1200 [Selling price = Cost price + Profit = 1000 + (20% of 1000) = 1000 + 200 = 1200]
C) 1250
D) 1400
Discuss
Q. The selling price of 8 shirts is equal to the purchase price of 10 shirts. What is the profit margin?
A) 25%
Description not available, Let’s discuss.
B) 20%
C) 40%
D) 80%
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Q. A trader sells an article at a loss of 10%. If the selling price of the article is $ 900, what is its cost price?
A) $1360
B) $1250
C) $1100
D) $1000
Selling price = Cost price - Loss = Cost price - (10% of Cost price) = Cost price - 
x Cost price = 
x Cost price
Cost price = Selling price / = $
= $1000
x Cost price = x Cost price
Cost price = Selling price / = $ = $1000
Discuss
Q. By selling goods for $119, gain is as much percent as it costs. What is the cost price?
A) $79
B) $63
C) $81
D) $70
Let, cost price= 
. According to the question, 
. Solving the above, 
.
. According to the question, . Solving the above, .
Discuss
Q. Profit after selling a product for $574 is as much as loss after selling it for $426. What will be the cost of the product?
A) $650
B) $555
C) $500
Answer: Observing the question we can notice that 
= 1000 which is two times the cost of the product. As the loss of one will compensate the other, the cost price is 
= $500.
= 1000 which is two times the cost of the product. As the loss of one will compensate the other, the cost price is = $500.
D) $400
Discuss
Q. A discount of 25% on a certain product enables a purchaser to buy 5 kg more for $300. What will be the price per kg after discount?
A) $21.75
B) $12.64
C) $18.50
D) $15.00
Answer: According to the question, after a discount of 25%, the buyer gets 5 kg more. So, the discounted price of 5 kg will be 
. Thus, the discounted price of one kg is 
. Thus, the discounted price of one kg is
Discuss
Q. A man sold a product at gain of 20% of the selling price. If gain is $25 exceeding costs, what will be the cost price of the product?
A) $75
Answer: Selling price=
×100=$100. So, Cost=
=$75.
×100=$100. So, Cost==$75.
B) $62
C) $56
D) $65
Discuss
Q. A grocer purchased 24 kg of tea at $3.25 per kg and mixed it with 12 kg of another type of tea. If he sells the mixture at $3.60 and makes a profit of 20%, what was the price of another type of tea available for mixture?
A) $2.80
B) $1.75
C) $1.20
D) $2.50
Answer: Let, X be the price of another type of tea. Cost of first type of tea=24×$3.25=$78. Cost price for sales of mixture= 
×100=$3.00. Total price of two types of tea=78+(12×X). According to question, (Total price/36)=3.00, or, X=$2,50.
×100=$3.00. Total price of two types of tea=78+(12×X). According to question, (Total price/36)=3.00, or, X=$2,50.
Discuss
Q. The percentage of profit when a refrigerator is sold for $26 is thrice as when it is sold for $22. What will be the selling price of the refrigerator when it is sold at 20% profit?
A) $22
Answer: Twice profit=$(26-22)=$4. So, thrice profit=$ 
. So, cost price=$(26-6)=$20. Thus selling price at 20% profit=$(20×120%)=$22.
. So, cost price=$(26-6)=$20. Thus selling price at 20% profit=$(20×120%)=$22.
B) $28
C) $32
D) $46
Discuss
Q. A man sold two articles for $800 each. On one he gains 20% and on the other he loses 20%. What is his net gain or loss?
A) Loss of $87
B) Gain of $91
C) Loss of $67
When it is sold at profit, cost price will be (
). When it is sold at loss, cost price will be (
). Now, profit or loss will be 
). When it is sold at loss, cost price will be (). Now, profit or loss will be
D) Gain of $59
Discuss
Q. A man sold two articles for $1200 each and gained on one and lost on the other by equal amounts. What was his gain or loss percent in the whole transaction?
A) 0%
Let C1 and C2 be the cost prices of two articles. Selling Price of first article = Selling Price of second article = Rs.(1200) Profit on first article = Loss on second article = X Total profit or loss = Profit on first article - Loss on second article = X - X = Zero Therefore, Net gain or loss percentage = ((Total profit or loss)/Cost Price) x 100% = ((Zero)/Cost Price) x 100% = Zero percent
B) 2%
C) 4%
D) 11%
Discuss
Q. Joe buys 140 dozen pen at $2.50 a dozen and 111 dozen pencil at $1.50 a dozen. By selling the both he makes a profit of $116. What will be the selling price of each pen if he sells the pencil at $0.16 each?
A) $3.00
B) $0.25
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C) $1.92
D) $0.50
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Q. A company makes a profit of 10% on its first $3,000 of sales each day and 2% on all sales in excess of $3,000 for that day. What would be the profit of the company in a day when sales are $10,000?
A) $460
B) $440
Profit for first $3,000=$3,000x10%=$300. Profit for rest of the sales volume $(10,000-3,000)X2%=$140. So, Total profit=$(300+140)=$440.
C) $140
D) $300
Discuss
Q. A retailer of a garment announced 20% rebate in prices of shirts. If a purchaser buys 6 shirts and enjoyed a rebate of $30, what should be the price of each shirt?
A) $36
B) $28
C) $25
Answer: Rebate for a shirt=(
)=5. Now, price of a shirt=(
=25.
)=5. Now, price of a shirt=(=25.
D) $22
Discuss
