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Profit & Loss revision summary with examples
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Profit & Loss revision summary with examples
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PROFIT & LOSSRevision Summary
With solved examples
, What is Profit?
When a person does a business transaction and gets more than what he had invested, then he is said s.
said to hav
profit. The profit he gets will be equal to the additional money he gets other than his investment.
So profit can be understood as the extra money one gets other than what he had invested.
Eg: A personbought an article for Rs. 100 and sold it for Rs. 120. Then he got Rs. 20 extra and so his profit
Rs. 20
What is Loss?
When a person gets an amount less than what he had invested, then he is said to have a loss. The loss wl
equal to the deficit he got than the investment.
Eg: A person bought an article at Rs. 100 and sold it for Rs. 90.
Then he got a deficit ofRs. 10 and so his l
is Rs. 10.
Cost Price (CP):
The money that the trader puts in his business is called Cost Price. The
price at which the articles are boug
is called Cost Price.
In other words, Cost Price is nothing but the investment in the business.
Selling Price (SP):
The price at which the articles are sold is called the Selling Price. The money that the trader gets trom
business is called Selling Price.
In other words, Selling Price is nothing but the returns from a business.
Marked/Market/List Price (MP):
The price that a trader marks or lists his articles to is called the Marked Price.
This is the only price known to the customer.
Discount:
The waiver of cost from the Marked Price that the trader allows a customer 1
is ealled Discount.
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