General Awareness:--Aptitude Part 3 Profit and Loss :

General Awareness:--Aptitude Part 3

Profit and Loss :

Profit and Loss problems are directly relevant for not only entrance exams , but also for the MBA syllabus like Accounting, Financial Statements and more. In this article we cover the basic definitions, formulas, solved examples and wrap it up with some practice questions.



Profit and Loss | Definitions, Formulas, Solved Problems

Basic Definitions and Formulas

• Cost price (C.P.): This is the price at which an article is purchased.
• Selling price (S.P.): This is the price at which an article is sold.
• Profit or Gain: If the selling price is more than the cost price, the difference between them is the profit incurred.
  

Formula: Profit or Gain = S.P. – C.P.

• Loss: If the selling price is less than the cost price, the difference between them is the loss incurred.
  

Formula: Loss = Cost price (C.P.) – Selling Price (S.P.)

• Profit or Loss is always calculated on the cost price.
• Marked price: This is the price marked as the selling price on an article, also known as the listed price.
• Discount or Rebate: This is the reduction in price offered on the marked or listed price.
  

Below is the list of some basic formulas used in solving questions on profit and loss:

• Gain % = (Gain / CP) * 100
• Loss % = (Loss / CP) * 100
• SP = [(100 + Gain%) / 100] * CP
• SP = [(100 – Loss %) / 100]*CP
  

The above two formulas can be stated as,
If an article is sold at a gain of 10%, then SP = 110% of CP.
If an article is sold at a loss of 10%, then SP = 90% of CP.

• CP = [100 / (100 + Gain%)] * SP
• CP = [100 / (100 – Loss%)] * SP
  

When a person sells two similar items, one at a gain of say x%, and the other at a loss of x%, then the seller always incurs a loss given by:

Loss % =		Common Loss and Gain %		2	=		x		2	.
		10					10

• If a trader professes to sell his goods at cost price, but uses false weights, then
  

Gain % =		Error	x100	%.
		(True Value) - (Error)

Profit and Loss: Solved Examples

Question : Alfred buys an old scooter for Rs. 4700 and spends Rs. 800 on its repairs. If he sells the scooter for Rs. 5800, his gain percent is:
Solution:
Cost Price (C.P.) = Rs. (4700 + 800) = Rs. 5500.
Selling Price (S.P.) = Rs. 5800.
Gain = (S.P.) - (C.P.) = Rs.(5800 - 5500) = Rs. 300.

Gain%= (300/5500)*100 %

Question : The percentage profit earned by selling an article for Rs. 1920 is equal to the percentage loss incurred by selling the same article for Rs. 1280. At what price should the article be sold to make 25% profit?
Solution:

Let C.P. be Rs. x.

Then,	1920 - x	x 100 =	x - 1280	x 100
	x		x

 1920 - x = x - 1280

2x = 3200

x = 1600

Required S.P.=125% of Rs. 1600

=(125/100)*1600

=Rs 2000

 Please subscribe for daily updates...

https://improvegknowledge.blogspot.com

https://www.facebook.com/General-Knowledge-for-Competitive-Exam-770344356485079/