BASICS OF PROFIT AND LOSS-LEARN SERIES

Hi Bankersdaily Aspirants,

Today we are going to discuss on Profit and Loss. This topic is quite interesting since we are using in day today life. This topic will be asked in Prelims as well as in Mains Examination.If you are good in this topic you can score 1 or 2 Marks in the Exam Easily.

TERMS RELATED TO PROFIT AND LOSS:

Cost Price =This is the price for which the article is Purchased.In our article we will indicate this price as C.P.

Selling Price:This is the price for which the article is Sold .In our article we will indicate this price as S.P.

Profit=This is the price for which the article is sold for a price more than the costPrice

Profit=Selling Price –Cost Price

Loss=This is the Price for which the article is sold for a price less than the costprice.

LOSS=Cost Price-Selling Price

MarkedPrice=This is the Price marked as Selling  price of the article,this is also known as listed Price.This is indicated as M.P.

Discount=This is the reduction in price offered on the marked or listed Price.

FORMULAS:

Gain%=(Gain/C.P.) * 100

Loss%=(Loss/C.P) * 100

Gain and Loss always reckoned on CostPrice.(We see Profit and Loss by comparing the CostPrice)

Calculating Selling Price When Profit/Loss and Selling Price is given:

C.P.=[(100/100+Gain%)]*SP

C.P.=[(100/100-Loss%)]*SP

Calculating Selling Price when Profit/Loss and Cost Price is given:

S.P.=[(100+Gain%)/100]*CP

S.P=[(100-Loss%)/100]*CP

TYPE 1:

FINDING GAIN AND LOSS PERCENTAGE:

1.An Article is purchased for Rs.450 and sold  for Rs.500.Find the Gain Percent?

Explanation

Gain=S.P.-C.P.

=500-450 =Rs.50

Gain Percent=(50/450)*100=(100/9)%

2.If the Cost Price is 25% of selling Price then what is the Profit Percent?

Explanation

Let the Selling Price  be Rs.100

Selling Price=Rs.100

Cost Price=25% of Selling Price=25% of 100=Rs.25

Profit=Selling Price-Cost Price=100-25=Rs.75

Profit Percent= (Profit/CostPrice)* 100

=(75/25)*100%

Profit Percent=300%

3.By selling 5Pens a Person gets profit equal  to Selling Price of  2Pens.What is Profit Percent?

Explanation

Let the Selling Price of 1Pen is Rs.1

Therefore Selling Price of 5Pens is Rs.5

Given that Profit =Selling Price of 2Pens

=1*2=Rs.2

Cost Price =Selling Price –Profit=5-2=Rs.3

Profit Percent= (Profit/CostPrice)*100

=2/3 * 100=66.66%

Profit Percent=66.66%

TYPE 2:

FINDING COST PRICE AND SELLING PRICE USING PROFIT OR LOSS:

1.A man buys a cycle for Rs.1400 and sells it at a loss of 15%.What is the Selling Price of  Cycle?

Explanation

Cost Price of the Cycle=Rs.1400

Loss Percent=15%

Selling Price= (100-Loss%)/100 * CP

=[(100-15)/100]*1400

=85/100 * 1400

Selling Price =Rs.1190

 

Alternate Method:

Explanation

Given that the CostPrice is 100% and  he Sold at a  Loss of 15% therefore the Selling Price is 85%

100% Rs.1400
85%

This is directly Proportional.

  (85 * 1400)/100=1190Rs.

 

 

 

 

  

 

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