Profit and Loss

Cost Price: It is defined as the amount at which the product/article is bought or the amount which is invested to make a product.
- The cost price is abbreviated as “CP”.
Selling Price:It is defined as the amount at which the product/ article is sold.
- The selling price is abbreviated as “SP”.

CONDITIONS:

Cost Price is less than selling price.
- C.P < S.P
Cost price is more than the selling price.
- C.P > S.P
Cost price is equal to the selling price.
- C.P = S.P

Profit

Profit means gain in amount when any product is sold.
When the cost price is less than the selling price then we earn profit.
Profit is calculated by subtracting the cost price from the selling price.

Example :

The cost price of the article is Rs 55 and the selling price is Rs 65. Find the profit.

Solution:

The cost price is Rs 55.
The selling price is Rs 65.
Since, the selling price is more than the cost price then there is a profit.
Subtract 55 from 65 to get the profit.
65 – 55 = 10
Therefore, profit = Rs 10.

Loss

Loss means losing an amount when any product is sold.
When the cost price is more than the selling price then we suffer loss.
Loss is calculated by subtracting the selling price from the cost price.

Example : The cost price of the article is Rs 100 and the selling price is Rs 85. Find the loss.

Solution:

The cost price is Rs 100.
The selling price is Rs 85.
Since, the selling price is less than the cost price then there is a loss.
Subtract 85 from 100 to get the loss.
100 – 85 = 15
Therefore, loss = Rs 15.