Profit, Loss and Discount shortcut techniques - Lesson 1 & 2

Profit, Loss and Discount shortcut techniques - Lesson 1


If you buy a mobile for Rs 1000, then it is called Cost Price. If you sell that to me for Rs 2500 (don't worry, I am dumb enough to buy that) then it is called the Selling Price. Here you made a "PROFIT" or "GAIN" of Rs 1500. If i sell the same mobile for Rs. 1800 to anybody else, then I will make a "LOSS" of Rs. 700.

Simply we can say that, if the Selling Price is is more than the Cost Price we can Make Profit. or If the Cost Price is more than the Selling Price then we will end up with Loss.

Profit = Selling Price (S.P) - Cost Price (C.P)


Percentage of Profit / Loss is calculated on the cost price by the following formula

Profit Percent = (Profit / Cost Price) X 100

Similarly,

Loss = Cost Price (C.P) - Selling Price (S.P)

Loss Per Cent = (Loss / Cost Price) X 100

Some Important Points to Remember :

1. Profit Or Loss Per Cent is always calculated on C.P and not in S.P
2. Overhead  expenses like Packaging, Transportation etc. are always added to the cost price to get the total C.P. and then profit per cent or loss per cent is calculated on this total cost price.
3. When the C.P and the S.P are given for different number of articles, first of all find C.P and S.P of equal number of articles and then only calculate profit per cent or loss per cent.

Marked Price and Discount :
When we go to a shop, we find price tags attached to the goods. The original price written on the price tag is called the "Marked Price". Sometimes, a reduction or concession is given on some Goods. We call this reduction as "Discount" . In Business, Discount is to attract the customers. More the sale, More the Profit :) Discount is given directly in terms of Money or in terms of other attractive articles. Direct discount is given on the labelled price. Which is much more than the actual cost price the seller has to pay. It is calculated in percentage. Seller gets profit even after giving discount to you.


Profit, Loss and Discount - Lesson II


Knowing the labelled price and the discount percentage and the percentage profit of the seller, we can get the actual cost price.

The selling price fixed by the seller includes all other necessary expenses like taxes, carting expenses etc. By giving some discount, the seller gets more customers.

Note  : Commission or brokerage is Added when we purchase, Subtracted when we Sell.


Note : In case of Successive discounts, the first discount is calculated on Marked Price, and is subtracted from it. The second discount is is then calculated on the resulting amount and again subtracted. The amount left after subtracting the last discount is the selling price of the Article.

The discount is always calculated on the Marked Price. have a look at the following Example.

A Shopkeeper marks the price of an article as Rs. 600. Find the selling price if he allows 10% discount ?
Sol :

Here, Marked price of the article = Rs 600
Shopkeeper is allowing a 10% discount.
So, if Rs 100 is Marked Price of the article, then Rs. 10 discount is offered on it.

So, Selling Price (S.P) of the article is Rs . 90.

so here, for Rs. 100 marked price the Discount = 10
             for Rs. 600 marked price, the Discount = ?
You can directly say the answer... Or,
(600/100) X 10 = 60

So, S.P = M.P - Discount  
             =>   600 - 60

                   => Selling Price = Rs 540