Profit and Loss

Profit and Loss - Sub Topics

  • Definition of Profit and Loss
  • Basic Concepts of Profit and Loss
  • Important Formulas
  • Profit

    If the selling price of an article is more than its cost price, then the dealer (or shopkeeper) makes a profit (or gain).



    If the selling price of an article is less than its cost price, the dealer suffers a loss.


    Some Basic Concepts of Profit and Loss

    Selling Price (SP) The price at which the shopkeeper sells the goods is called the selling price (SP) of the goods sold by the shopkeeper to the customer.

    Cost Price (CP) - The money paid by the shopkeeper to the manufacturer or whole-seller to buy goods is called the cost price (CP) of the goods purchased by the shopkeeper.

    Marked Price (MP) - Marked price is the price set up by the seller on the article. Marked price is also known as the list price. It is the price that a seller sets up for the purchaser on which he later applies a discount.

    Discount: A discount is a reduction in the market price of a product that is offered to a customer.

    Some Important Formulas

    Here are some of the important formulas used in calculating the profit and loss percentage. It is used to express the profit or loss incurred in % form.


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