Understanding: Profit and loss as Percentage Video Lecture - Class 7

good morning children today we shall
learn what is the use of percentage in
profit and loss in a previous lesson we
learnt about profit and loss say the
shopkeeper Manilal spent 200 rupees to
buy white shirt from the wholesaler he
sold it at rupees 232 one customer what
is the profit he made by selling this
shirt
we know profit means selling price is
greater than the cost price correct and
profit is equal to selling price that is
a spin shot minus the cost price that is
CP in short in this case the SP is
rupees 230 and CP which is cost price is
rupees 200 so profit is equal to SP
minus CP which is equal to 230 minus 200
so we can say profit is equal to rupees
30 and thus Manilal makes rupees 30 as
is profit on the other hand Raheem
spends rupees 50 to get bread vegetables
etc and he sells the sandwich made out
of it for rupees
80 what is the profit he made by selling
the sandwich let us see in this case SP
is rupees 80 which is the selling price
of the sandwich and CP is 50 which is
the cost price of the sandwich that is
the amount spent in getting the sandwich
ready
so Rahim makes the profit which is equal
to 80 minus
50 and thus the profit is equal to
rupees 30 and we can say Rahim made a
profit of rupees 30 per sandwich so me
see Rahim spent much lesser than Manilal
Manilal spent rupees 200 and Rahim spent
rupees 50 but both earned the same
profit which is rupees 30 can we
consider both of these profit as same
let us see in a contest a man lifts 50
kg but a child just lifts 10 kgs and
who's the winner
the man is declared the winner but is it
fair to compare the strength of a child
with an adult no that's not fair so for
fair contest we compare the strength of
one adult with another adult correct
because a child is supposed to be weaker
than an adult so if a person wants to
prove himself stronger he must compare
his strength to another adult same way
when we compare profits to see who is
the better businessman we should see who
would earn more profit if each of them
spent the same amount of money this
means bring them to the same level
before the comparison as people may
spend different amount and may get
different profit we calculate percentage
of profit that is how much profit would
a person make if he had spent rupees 100
that is the cost price was rupees 100 we
already know how to find the percentage
as we are finding the percentage against
the cost price
we divide profit by cause price then we
multiply with 100 so the formula for
percentage of profit is profit divided
by cause price multiplied by 100 this is
profit per hundred rupees and we call it
as the percentage of profit thus when we
say percentage we mean per hundred what
is the percentage of profit cut what is
the percentage of profit Manilal made
money naal made 30 divided by 200 in 200
as the percentage of profit we can
divide 100 by 200 so the profit
percentage is 30 divided by 2 which is
equal to 15 hence we can say the
percentage of profit is 15 percent it
means he would make rupees 15 as profit
for every hundred rupees he spent
similarly Raheem's percentage of profit
is equal to 30 divided by 50 in 200 as
the profit was 30 and the cost price was
50 here we can divide 50 by 100 so
profit percentage becomes 30 multiplied
by 2 which is equal to 60 so the profit
percentage is 60 it means he would make
rupees 60 as a profit for every hundred
rupees he spent so if we compare
Neal made a profit of 15 percentage
meaning 15 rupees per hundred rupees and
Rahim made a profit of 60 percentage
meaning profit of rupees 60 per hundred
who is better 60 percent is more than 15
percent correct
this means Raheem's business is more
profitable than money laughs as for the
same amount spent Rahim would make more
profit than Manilla and what about loss
loss means cos price is greater than the
selling price and loss is equal to cos
price - selling price that is CP minus
SP we can express the loss in percentage
- percentage of loss is equal to loss
divided by cos price multiplied by 100
it means how much loss is made per
hundred rupees correct you might wonder
why do we divide profit or loss by cos
price only why not selling price when we
say Manilal made 15 rupees as profit it
means he made 15 rupees extra on every
hundred rupees he spent which is the
cost price 15 percent profit means he
spends 100 rupees and makes 15 rupees
extra that is total he gets rupees 115
and if we say Manilal made 15 percent
loss it means on every hundred rupees he
spent he lost 15 rupees 15 percent loss
means
he spends 100 rupees and loses 15 rupees
that is he gets back
only rupees 85 in return of spending
rupees 100 thus it's the cost price
which is used to calculate the
percentage of profit or loss say check
and earn 20% profit spending rupees 1500
how much profit did he make
he made profit equal to 20% of 1500 so
we can say profit is equal to 20 divided
by hundred multiplied by 1500 we can
cancel hundred from both the numerator
and the denominator so we get 20
multiplied by 15 thus he made profit
equal to 300 rupees
understood so remember children what we
learnt today about profit percentage and
loss percentage profit percent is equal
to profit divided by cause price
multiplied by hundred where profit is
equal to SP which is the selling price
minus CP which is the cost price same
way the last percent is equal to loss
divided by the cost price multiplied by
100 here the loss is equal to CP minus
SP that was all for today bye bye
children