Table of contents  
Introduction  
Profit and Loss Related Terms  
Profit and Loss Formulas  
Profit and Loss Tricks 
Profit and loss are common terms used to determine the profitability of a transaction. If the selling price exceeds the cost price, the difference is referred to as profit. Conversely, if the selling price is lower than the cost price, the difference is called a loss. The initial amount paid to buy a product is known as the cost price, while the amount at which the product is sold is called the selling price.
When someone purchases an item at a specific price and then sells it at a different price, they either make a profit or experience a loss. There are several terms related to the process of conducting a transaction, such as the cost price of the item (C.P.), selling price (S.P.), discount, marked price, profit, and loss.
Let's explore the meanings of these terms individually:
The amount gained by selling a product for more than its cost price.
The amount the seller incurs after selling the product less than its cost price is mentioned as a loss.
The amount paid for a product or commodity to purchase is called a cost price. Also, denoted as CP. This cost price is further classified into two different categories:
The amount for which the product is sold is called the Selling Price. It is usually denoted as SP. Also, sometimes called a sale price.
This is basically labelled by shopkeepers to offer a discount to the customers in such a way that,
Now let us find the profit formula and loss formula:
Profit or Gain = Selling price – Cost Price
Loss = Cost Price – Selling Price
The formula for the profit and loss percentage is:
These are some common examples of the profit and loss concept in real life, which we observe regularly.
You have learned until now how to calculate profit, loss, and percentage of them. Now let us learn some tricks or formulas to solve maths problems based on gain and loss.
30 videos64 docs19 tests

1. What are some common profit and loss related terms? 
2. What are some important profit and loss formulas? 
3. Can you provide some profit and loss tricks for quick calculations? 
4. How can one analyze a company's profit and loss statement? 
5. How can one improve profitability in a business based on profit and loss analysis? 

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