Summary: Profit Loss

Table of Contents
1. What are Profit and Loss?
2. Basic Concepts
3. Primary Formulas
4. Percentage Formulas
5. Useful Short Tricks
6. How to Calculate Profit and Loss
7. Key Formulas - Quick Summary
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What are Profit and Loss?

Profit is the amount gained when the Selling Price (S.P.) exceeds the Cost Price (C.P.). Loss is the amount lost when the S.P. is less than the C.P. Formulas: Profit = S.P. - C.P. and Loss = C.P. - S.P.

Basic Concepts

• Cost Price (C.P.) - amount paid to acquire a product; may include overheads, transport, setup.
• Selling Price (S.P.) - amount at which the product is sold; can be ≥, =, or ≤ C.P.
• Marked Price (M.P.) - price displayed on the item (tag or list price); if no discount applies, S.P. = M.P.
• Discount - reduction on M.P. when item is sold for less than M.P.

Primary Formulas

• Cost Price = Selling Price - Profit
• Cost Price = Selling Price + Loss
• Profit = S.P. - C.P.
• Loss = C.P. - S.P.
• Selling Price = C.P. + Profit
• Selling Price = C.P. - Loss
• Marked Price = Selling Price + Discount
• Discount = M.P. - S.P.

Percentage Formulas

• Profit percentage = (Profit × 100) / C.P.
• Loss percentage = (Loss × 100) / C.P.
• Discount percentage = (Discount / M.P.) × 100

Useful Short Tricks

• P = S.P. - C.P. when S.P. > C.P.; L = C.P. - S.P. when C.P. > S.P.
• P(%) = (P / C.P.) × 100 ; L(%) = (L / C.P.) × 100
• S.P. = {(100 + P%) / 100} × C.P. ; S.P. = {(100 - L%) / 100} × C.P.
• C.P. = {100 / (100 + P%)} × S.P. ; C.P. = {100 / (100 - L%)} × S.P.
• When two profits x% and y% occur, net profit% = x + y + (x × y) / 100
• When profit is x% and loss is y%, net% = x - y - (x × y) / 100
• If Profit % and Loss % are equal then P = L and %loss = (Profit)² / 100
• If a product is sold at x% profit and then again at y% profit, CP = [100 × 100 × P / ((100 + x)(100 + y))]. For losses: CP = [100 × 100 × L / ((100 - x)(100 - y))]

How to Calculate Profit and Loss

• Step 1: Check whether C.P. > S.P. or S.P. > C.P.
• Step 2: If C.P. > S.P., compute Loss = C.P. - S.P.
• Step 3: If S.P. > C.P., compute Profit = S.P. - C.P.

Key Formulas - Quick Summary

• Profit = S.P. - C.P.
• Loss = C.P. - S.P.
• Profit (%) = (Profit / C.P.) × 100
• Loss (%) = (Loss / C.P.) × 100
• Discount = M.P. - S.P.
• Discount (%) = (Discount / M.P.) × 100