Profit and loss in a simple way to understand for placement. it include the tips and tricks to crack this. it is very much useful for developing your apptitude knowledge.

1. PROFIT AND LOSS

2. BASICS
1) COST PRICE:
IT IS THE PRICE AT WHICH A PRODUCT IS PURCHASED. IT IS COMMONLY ABBREVIATED AS C.P.
2) SELLING PRICE:
IT IS THE PRICE AT WHICH A PRODUCT IS SOLD. IT IS COMMONLY ABBREVIATED AS S.P.
3) PROFIT OR GAIN:
IF THE SELLING PRICE OF A PRODUCT IS MORE THAN THE COST PRICE, THERE WILL BE PROFIT
IN THE DEAL.
THEREFORE, PROFIT OR GAIN = S.P. - C.P.
4) LOSS:
IF THE SELLING PRICE OF A PRODUCT IS LESS THAN THE COST PRICE, THE SELLER WILL INCUR A
LOSS.
THEREFORE, LOSS = C.P. - S.P.

3. 5) PROFIT OR GAIN % =S.P.- C.P ∗100→PROFIT ∗100
C.P C.P
6) LOSS % = C.P.- S.P ∗100→LOSS ∗100
C.P C.P
7) IF THERE IS A PROFIT OR GAIN IN THE DEAL OR TRANSACTION;
SELLING PRICE (S.P.) = (100 + PROFIT %) ∗C.P
100
AND, THE COST PRICE (C.P.)= ( 100 )*S.P
100 + PROFIT%
8) IF THERE IS A LOSS IN THE DEAL OR TRANSACTION;
SELLING PRICE (S.P.) = (100 - LOSS %) ∗C.P
100
AND, THE COST PRICE (C.P.) = ( 100 )*S.P
100 - LOSS%

4. 9) IF AN ARTICLE IS SOLD AT A PROFIT OF X%, THE SELLING PRICE WOULD BE EQUAL TO X% OF
COST PRICE (X/100 * C.P).
10) IF AN ARTICLE IS SOLD AT A LOSS OF X%, THE SELLING PRICE WOULD BE EQUAL TO (100-X)% OF
COST PRICE (100 - X ∗C.P).
100
11) WHEN A SELLER SELLS TWO SIMILAR ITEMS ONE AT X% GAIN AND ANOTHER ONE AT SAME (X
%) LOSS, THE SELLER ALWAYS INCURS A LOSS IN THE DEAL WHICH IS GIVEN BY:
LOSS %=(LOSS % ∗ GAIN %) %
100

5. METHODS TO SOLVE PROBLEMS
1) IF A SELLER CLAIMS THAT HE IS SELLING GOODS AT COST PRICE BUT USES FALSE WEIGHT TO EARN
PROFIT;
% PROFIT =(TRUE WEIGHT- FALSE WEIGHT) ∗100
FALSE WEIGHT
2) IF A SELLER SELLS A PRODUCT AT X% LOSS BUT USES WEIGHT Y INSTEAD OF Z, THE % GAIN EARNED
OR % LOSS INCURRED IS GIVEN BY:
= (100 - X)Z-100
Y
+VE SIGN WILL INDICATE PROFIT AND -VE SIGN WILL INDICATE LOSS.
3) IF A SHOPKEEPER USES WEIGHT Y GM INSTEAD OF 1 KG AND INCURS AN X% LOSS ON COST PRICE, HIS
ACTUAL GAIN OR LOSS % IS GIVEN BY:
= (100 - X)100-100
Y
+VE SIGN WILL INDICATE PROFIT AND -VE SIGN WILL SHOW THE LOSS.

6. 4) IF A SHOPKEEPER USES WEIGHT Y GM INSTEAD OF 1 KG AND EARNS A PROFIT OF X% ON COST
PRICE, HIS ACTUAL GAIN OR LOSS % IS GIVEN BY:
= (100 + X)100-100
Y
+VE SIGN WILL INDICATE PROFIT AND -VE SIGN WILL INDICATE THE LOSS.
5) IF THERE ARE TWO SUCCESSIVE PROFITS OF X% AND Y% IN A TRANSACTION, THE RESULTANT
PROFIT IS GIVEN BY:
RESULTANT PROFIT = (X + Y +XY)
100
6) IF THERE IS A PROFIT OF X% AND LOSS OF Y% IN A TRANSACTION, THE RESULTANT PROFIT OR
LOSS IS GIVEN BY:
RESULTANT PROFIT OR LOSS = (X+Y -XY)
100
+VE SIGN WILL INDICATE PROFIT AND -VE SIGN WILL INDICATE THE LOSS.

7. 7) A SELLER SELLS A PRODUCT AT PROFIT OF X%. IF HE SELLS IT FOR RS. Z MORE, HIS PROFIT WOULD BE Y%. IN THIS CASE THE COST PRICE IS
GIVEN BY:
C.P. =
8) IF THE COST PRICE AND SELLING PRICE OF A PRODUCT ARE REDUCED BY SAME AMOUNT (X), THE COST PRICE IS GIVEN BY:
C.P. =(INITIAL PROFIT % +INCREASE IN PROFIT %) ∗ X)
INCREASE IN PROFIT %
9) IF THE COST PRICE OF P ARTICLES IS EQUAL TO THE SELLING PRICE OF Q ARTICLES, THEN PROFIT % OR LOSS % IS GIVEN BY:
10) IF A SELLS A PRODUCT TO B AT A GAIN OR LOSS OF P% AND B SELLS IT TO C AT A GAIN OR LOSS OF Q%, THE FINAL GAIN OR LOSS IS GIVEN
BY:
(P+Q+PQ)
100
+VE SIGN WILL INDICATE PROFIT AND -VE SIGN WILL INDICATE THE LOSS.
11) IF A SHOPKEEPER MARKS THE PRODUCTS AT P% ABOVE THE COST PRICE AND GIVES THE CUSTOMER A DISCOUNT OF Q%, THE FINAL
PROFIT OR LOSS % IS GIVEN BY =

8. EXAMPLES
1. COST PRICE = RS. 60, GAIN=35% WHAT IS SELLING PRICE?
SOLUTION:
SELLING PRICE = COST PRICE + GAIN
=60 + {(35/100)*60}
=RS. 81

9. EXAMPLES
2. IF SURESH BUYS TWO SHEEPS AT RS. 1500 EACH AND SELLS ONE AT A GAIN OF 15% AND
ANOTHER AT A LOSS OF 15%. HOW MUCH DOES HE GAIN OR LOSS IN THE WHOLE TRANSACTION?
SOLUTION:
NEITHER LOSS NOR GAIN
EXPLANATION:
WHATEVER HE GAIN ON THE 1ST SHEEP, THE SAME HE LOSS ON THE OTHER SHEEP.

10. EXAMPLES
3. 20% LOSS ON SELLING PRICE IS WHAT PERCENT LOSS ON THE COST PRICE?
SOLUTION:
LET US ASSUME S.P = RS. 100, THEN LOSS = RS. 20
THEREFORE C.P = RS. 120
LOSS% = 20/120*100
=50/3
=16 2/3

11. EXAMPLES
4. IF THE COST PRICE IS 75% OF THE SELLING PRICE, THEN WHAT IS THE PROFIT PERCENTAGE?
SOLUTION:
ASSUME THAT THE SELLING PRICE IS RS. 100, THEN COST PRICE IS RS. 75
THEN PROFIT = RS. 25
PROFIT % =25/75*100
=100/3
=33.33%

12. EXAMPLES
5. A CLOTH MERCHANT MAN SAYS THAT DUE RAINY IN THE MARKET, HE SELLS THE CLOTH AT 20%
LOSS, BUT HE USES A FALSE METRE SCALE AND ACTUALLY GAIN 25%. FIND THE ACTUAL LENGTH
OF THE SCALE?
SOLUTION:
TRUE SCALE/FALSE SCALE=(100+GAIN%)/(100-LOSS%)
100/FALSE SCALE=(100+25)/(100-20)
FALSE SCALE=80*100/125
FALSE SCALE=64.

13. EXAMPLES
6. A CYCLE WAS PURCHASED FOR RS.1800 AND SOLD FOR RS.1300. FIND LOSS OR PROFIT?
SOLUTION:
COST PRICE = RS. 1800 ; SELLING PRICE = RS. 1500
SINCE S.P < C.P, THERE IS A LOSS
GAIN = C.P – S.P =1800 – 1500 =RS. 500 ., SO LOSS

14. EXAMPLES
7. A DEALER PROFESSES TO SELL HIS GOODS AT COST PRICE, BUT HE USES A WEIGHT OF 850G FOR
THE KG WEIGHT. FIND HIS GAIN PERCENT?
SOLUTION:
% PROFIT =(TRUE WEIGHT- FALSE WEIGHT) ∗100
FALSE WEIGHT
ERROR =TRUE WEIGHT-FALSE WEIGHT
=1KG – 850G
=1000G – 850 G =150G
PROFIT %=(150/850)*100
= 17 11/17
THEREFORE, GAIN%= 17 11/17

15. EXAMPLES
8. A MAN BOUGHT A BUFFELOW AND A CARRIAGE FOR RS.3000, HE SOLD THE BUFFELOW AT A GAIN OF 20% AND THE
CARRIAGE AT A LOSS 10% THEREBY GAINING 2% ON THE WHOLE. FIND THE COST OF BUFFELOW?
SOLUTION:
LET THE COST OF BUFFELOW IS X RUPEES.
THEN THE COST PRICE OF CARRIAGE = RS. (3000 – X)
(20% OF X) – (10% OF (3000 – X) = 2% OF 3000
{(20/100)*X} – {(10/100)(3000 – X)} = {(2/100)*3000}
{X/5} – {(3000 – X)/10)} = 3000/50
MULTIPLY BY 10 ON BOTH SIDES, THEN
2X – 3000 + X = 600
3X = 3600
X=1200
THEREFORE, THE COST OF BUFFELOW IS RS.1200

16. EXAMPLES
9. A MAN BUY A CYCLE FOR RS. 1600 AND SELLS IT AT A LOSS 20%. WHAT IS SELLING PRICE?
SOLUTION:
C.P = RS. 1600, LOSS=20% ; S.P = ?
SELLING PRICE = COST PRICE - (20% OF 1600)
=1600 - {(20/100)*1600}
=1600 – 320
=1280
SELLING PRICE = RS. 1280

17. PRACTICE QUESTIONS
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