Eduwhere Concept: Profit & Loss
- Neha Gore
- last edited by Neha Gore
Profit & Loss plays a key role in the realm of economics and accounting. Questions related to Profit & Loss are likely to appear in your upcoming examination. Here are some basic terms and formulae involved in Profit & Loss.
Profit = S P – C P
Loss = C P – S P
Profit percentage = [Profit/cost price] × 100
Loss percentage = [loss/cost price] × 100
Loss or gain is always calculated over CP.
%Gain = {(Gain*100)/CP}
%Loss = {(Loss*100)/CP}
Cost Price:
The price at which the article is purchased is called the Cost Price.
Take a look at some important formulae related to Cost Price:
C P = [100/ (100 + gain%)]×S P = [100/ (100 + loss%)]×S P
CP = {100/(100 %Gain)}*SP
CP ={100/(100-%Loss)}*SP
Selling Price:
The price at which the article is sold to the buyer is called the Selling Price.
S P = (100 +k) % of C P; where profit = k% of C P.
S P = (100 – k)% of C P; where loss = k% of the C P.
S P = [(100 + gain%)/100]×C P = [(100 + loss%)/100]×C P
S P = {(100 %Gain)/100}*CP
S P = {(100-%Loss)/100}*CP
Listed Price:
The suggested retail price by the manufacturer is referred to as Listed Price.
Marked Price:
The price on the label of an article/ product is called the marked price. Marked price or List price.
Marked Price = C P + Markup
M P (Marked Price) = C P + (%markup on C P)
When Discount is offered, M.P. > S.P.
When Discount is not offered, M.P. < S.P.
Discount = Marked Price – Selling Price
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