# Profit and Loss - Important Points

Profit and Loss - Questions

## Cost price

Cost Price (CP) is the price at which an article is purchased.

## Selling price

Selling Price (SP) is the price at which an article is sold.

If SP is more than CP, it is a profit or gain

If CP is more than SP, it is a loss.

• Gain or Profit = SP – CP
• Loss = CP – SP
• Loss or gain is always reckoned on CP

## Profit Percentage Formula

(Profit %) = (Profit / CP) x 100 = (SP – CP) / CP x 100 = [(SP / CP) – 1] x 100

## Loss percentage Formula

(Loss %) = (Loss / CP) x 100 = (CP – SP) / CP x 100 = [1 - (SP / CP)] x 100

• If Profit or Gain % is given then SP = CP x [(100 + Profit %) / 100]
• CP = SP x 100 / [(100 + Profit %)]
• If loss % is given then SP = CP x [(100 - Loss %) / 100]
• CP = SP x 100 / [(100 - Loss %)]

If an article is sold at a profit of 25%, then SP = 125 % of  CP

If an article is sold at a loss of 25% then SP = 75% of CP

• If a person increases the price of an item by A% and then gives a discount of B%, then
• Net Percent Change = A – B – [(A x B) / 100]
• If the final result is positive, that is Profit % and if final result is negative, that is loss%
• If a trader professes to sell his goods at cost price, but uses false weights
• Gain % = [Error / (True value – Error)] x 100

• If an article is sold after allowing a discount (d%) on marked price (MP) then the selling price (SP) is given by
• SP = (100 – d) % ×  MP
• If an article is sold after allowing two successive discounts of d1% and d2% then selling price (SP) is given by SP = [(100 – d1) / 100] x [(100 – d2) / 100] x MP
• Two successive discounts of d1 and d2  are equivalent to a single discount of
• d1 + d2 – [(d1 x d2) / 100]