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Quantitative Aptitude›Ch 2: Commercial Maths›Profit and Loss Essentials

2.2

Profit and Loss Essentials

5 min

Master CP, SP, False Weights, and Successive Selling logic.

1

The Golden Rule

Profit and Loss are always calculated on the Cost Price (CP). In cases of false weight, the profit is calculated based on the weight actually given to the customer.

2

Why this matters?

  • High weightage: 2-3 questions in every SSC and Railway Tier-1 exam.
  • Foundation for Discount, Simple Interest, and Compound Interest topics.
  • Direct application of Percentage concepts in real-world business scenarios.

Quick Memory Hooks

  • Profit = SP > CP; Loss = CP > SP.
  • False weight Gain % = [Error / (True Value - Error)] × 100.
  • Successive: Use a + b + (ab/100) for two consecutive changes.
3

Key Formulas & Relations

ScenarioCalculation LogicFinding SP
Profit %SP - CPCP × (100 + P)/100
Loss %CP - SPCP × (100 - L)/100
False WeightGain on Given WtSP = CP (usually)
4

Profit & Loss Flow

Cost Price

(Buying Amount)

Cost Price: Buying Amount

Buying Amount

Money spent to acquire an item.

Selling Price

(Selling Amount)

Selling Price: Selling Amount

Selling Amount

Price at which item is sold.

Profit

(Positive Gap)

Profit: Positive Gap

Positive Gap

When SP is more than CP.

Loss

(Negative Gap)

Loss: Negative Gap

Negative Gap

When CP is more than SP.

5

Avoid These Mistakes

Calculating profit % on SP.Always calculate profit % on CP.

Base must be CP unless SP is mentioned in the question.

Adding successive profit percentages.Use multiplicative or formula method.

10% + 10% successive is not 20%, it is 21%.

Gain % on 1kg in false weight.Gain % on the actual weight given.

If giving 900g for 1kg, base for profit is 900g.

6

Quick Practice

Q1.A man buys an item for ₹800 and sells it for ₹1000. Find the profit percentage.

Q2.A dishonest dealer uses a weight of 960g instead of 1kg. Find his profit %.

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