Profit Formula

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Profit is the gain or the benefit received during a transaction. Cost price of an article or a substance is the amount at which it is purchased. Selling price is of an article or a substance is the price at which it is sold. If the selling price is more than the cost price profits can be made. The formula used to calculate the profit is
Profit = Selling Price (S.P.) – Cost Price (C.P.)

Example 1: A person buys 10 articles for a price of $ 10 each and sells each article at a price of $ 12. Does the person make any profits? If he does how much?

Solution: Cost price of each article = $10.

Total cost price for 10 articles = $100.

Selling price of each article = $ 12

Total selling price for 10 articles = $120.

Profit = Selling Price (S.P.) – Cost Price (C.P.)

Profits made = $ (120 – 100) = $20.

Hence the profits made is $20.

Example 2: A person buys 6 chairs for a price of $8 each and sells each chair at a price of $11. Does the person make any profits? If he does how much?

Solution: Cost price of each chair = $8.

Total cost price for 6 chairs = $48.

Selling price of each chair = $11

Total selling price for 6 chairs = $66.

Profit = Selling Price (S.P.) – Cost Price (C.P.)

Profits made = $ (66 – 48) = $18.

Hence the profits made is $16.
 
 
 
 
 

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