SBI PO 2015: Short Notes on Profit & Loss

In our journey so far, many outstanding, proficient and beautiful posts have been published on BankersAdda. These post don’t deserve to become a history, they should be posted again and again because of following reasons –
• Many new readers come on BA who might not be aware about it.
• For the revision purpose
• For upcoming exams
• And the most important of all, as a token of  RESPECT for these extremely superb posts
So, we have decided to dug out these post for the upcoming SBI PO 2015 Exam.

One such post is this one, Profit & Loss. It was contributed by Piscine Molitor, one of the matchless reader of BA, who is extinct these days. So, as a respect to the post & Pi, we are re-publishing the post!!!

This section is quite interesting. Concepts are simple but Questions are logical.

I bought a rare novel worth Rs. 400. After finished reading, I thought of selling it to somebody else. I scratched the sticker and then put my own sticker on it that said, “500 Rs only” so that I can make a sweet profit of 100Rs on this Novel.
Now, a customer has come to me to buy this novel. But to buy it for 500Rs, he’s not ready.He wants some discount on it.

Okie, I will give you a 5% discount, I said. He calculated that 5% of 500 means 25Rs only. He rejected. Said, he want more discount.
Okie, I will give you a final 10% discount, but not more. Take it or leave it. He calculated, 10% discount on 500Rs means 50Rs discount.
He said Okie. He gave me 450 Rs and then bought this Novel.

Now, let’s answer these quick simple questions based on the above information.

Ques: What is the Cost price of this Novel?
Ans: 400Rs
Ques: What is the Marked Price of this Novel?
Ans: 500Rs
Ques: How much is the Markup?
Ans: Markup is the extra price which is added to the cost price. Markup = 500 – 400 = 100Rs
Ques: What is the discount % on this Novel?
Ans: 10%
Ques: What is the discount in Rs on this Novel?
Ans: 10% of 500 = 50Rs
Ques: What is the Selling Price of this Novel?
Ans: Selling price is the price at which he bought the Novel after deducting the discount from the Markup Price. SP = MP – Discount = 500-50 = 450Rs
Ques: What is the profit in Rs on this Novel?
Ans: 50Rs
Ques: What is the Profit percent?
Ans: 50Rs profit I made on 400Rs Cost Price of novel. In percentage, Profit % = [50/400]*100 = 12.5%
Ques: What is the maximum discount I could have offered so I had not incurred a loss?
Ans: Maximum discount = 500-400 = 100Rs on 500Rs sticker. That means [100/500]*100 = 20% discount.
Ques: If I had given him a discount of 25%, would I had incurred a loss?
Ans: 25% of 500Rs means [25/100]*500 = 125Rs. Selling price after discount = 500-125 = 375Rs. Selling price is lower than Cost price. So, yes, I would have incurred a loss if I had given him 25% discount.
Ques: At 25% discount, what should have been the loss percentage?
Ans: at 25% discount on 500Rs (means 125Rs discount), my Selling Price would have been 500-125=375Rs. I would have faced a loss of 400-375 = 25Rs on my 400Rs cost price Novel. Loss% would have been = [25/400]*100 = 6.25%

Feel all this stuff before going any further…

Let’s now deduce some formulae (note all these down in your copy)

CP = Cost Price
SP = Selling Price

When SP < CP  Loss = CP – SP
When SP > CP  Profit = SP – CP

Note:Loss% and Profit% both are calculated upon CP

Profit% = [Profit/CP] * 100

Loss% = [Loss/CP] * 100

Now, some more general things we can deduce…

(1) When profit% is given, say, 10% profit

Then SP becomes [100+profit%] of CP = [100+Profit%]/100
For 10% profit, SP = 110% of CP = [110/100]*CP = 1.1*CP
Means to say, if 10% profit, then we simply do SP = 1.1*CP
If CP is given, then SP is calculated, and if SP is given then CP is calculated (CP = SP/1.1)
(2) When loss% is given, say, 10% loss
Then again, SP becomes [100-loss%] of CP, again same approach.
For 10% loss, SP becomes 90% of CP = 0.9*CP
If CP is given, then SP is calculated, and if SP is given, then CP is calculated (CP = SP/0.9)
Note: Remember these general deductions. These helps a lot in solving questions quickly.

Marked price = Cost price + Markup

CP –> + Markup –> = MP

Always Remember: Markup is extra price on Cost Price. So, Markup is always calculated on CP

And %Markup = [Markup/CP]*100

Means to say if 400Rs CP and 100Rs Markup, then MP becomes 500Rs and %Markup becomes [100/400]*100 = 25%

Discount (if SP < MP) = MP – SP i.e. SP = MP – Discount

MP  – Discount  = SP

Always Remember: Discount is deducted from Marked Price. So, Discount is always calculated on MP

And %Discount = [Discount/MP]*100

Means to say, if 500Rs is MP and 50Rs is discount, then discount% = [50/500]*100 = 10%

General Notes:

Like SP and CP relation, SP and MP relations is also calculated using the same approach.
I.e. if 10% discount is there, then SP becomes [100-discount%] of MP, means SP = 90% of MP, means SP = 0.9*MP
So, if MP is given, we can calculate SP and if SP is given, then MP is calculated (MP = SP/0.9)
Needless to tell you to note it down as this also helps in solving questions quickly!

More Notes:

(1) If markup is there and after discount, there is a profit, then: CP < SP < MP
(2) If markup is there and after discount, there is no profit no loss, then: CP = SP < MP
(3) If markup is there and after discount, there is a loss, then, SP < CP < MP

Practice these concepts with this question!!

Quiz Ques 1:

Using

CP = 400Rs
Markup% = 20%
Profit% = 7.5%

Find these values:

(a) Markup,
(b) Market Price,
(c) Profit,
(d) Selling Price,
(e) Discount Price,
(f) Discount%

Solve this question before going any further.
(Answer to this Question after 1 hour)

Now let’s see a few quick ones that comes many a times in exams.

Ques1: If Cost price of 15 apple is equal to Selling price of 20 apples, what is the gain or loss percent?
Ans: CP of 15 apple = SP of 20 apple
Means, CP*15 = SP*20
Means CP/SP = 20/15 = 4/3
Clearly, CP > SP, means loss is there
If CP is 4 Rs, SP is 3 Rs
• Loss is 1 on CP of 4 Rs
• Loss % = [1/4] * 100 = 25%

Ques2: By selling 8 bananas a fruit seller gains the selling price of 1 banana. Calculate his profit percent.
Ans: Let SP of 1 banana = 1 Rs
Means SP of 8 banana will be 8 Rs
Profit on SP of 8 Rs is 1 Rs CP would be 8-1 = 7 Rs
On 7 Rs, 1 Rs profit is there  profit% = 1/7 * 100 = 14.2857% profit
Note: Profit or loss is always calculated on Cost price!!

Ques3: A trader sells all his books at the cost price but gives 15% less books as he should give. Find his profit percentage?
Ans: let 100 books are there.
Books left = 15% = 15 books
So, books sold = 100-15 = 85
On 85 books sold, he gets 15 books as profit
Profit % = [books left / books sold]* 100 = [15/85]*100 = 17.64%

Ques 4: A person bought 3 Oranges for 2 Rs and sold 2 Oranges for 3 Rs. Calculate his Profit percentage?
Ans: 3 Oranges bought for 2 Rs –> 6 Oranges bought for 4 Rs
2 Oranges sold for 3 Rs –> 6 Oranges sold for 9 Rs.
6 Oranges, CP = 4 Rs, SP = 9 Rs –> Profit = 5 Rs
• Profit Percentage = [5/4]*100 = 125%
Note: Always remember to equate things (Oranges in this case), not money.

Enough learning. Now solve these questions and you completes the concepts of Profit and Loss!!
Quiz Ques2: Two articles are sold at the same Selling Price. One at a profit of 75%, and other at loss of 30%. What is the overall profit or loss?
Quiz Ques 3: The percentage profits on three articles A, B, and C is 10%, 20% and 25% and the ratio of their cost price is 1:2:4. Also, the ratio of the number of articles sold of A, B and C is 2:5:2.The overall percentage is how much?
Quiz Ques 4: CP of 12 articles is equal to SP of 9 articles. Profit on 5 articles is equal to the discount on 10 articles. Find the Markup% and Discount%
(Answers to Quiz Questions after 1 hour)

Hope You Enjoyed This Post!!

Thank You!!

Thanks Pi!!