Profit, Loss & Discount — Banking Quant Notes Ch. 8

Introduction

Profit & Loss questions revolve around three values — Cost Price (CP), Selling Price (SP), and Marked Price (MP) — connected through percentage relationships. This chapter builds directly on the fraction-equivalent method from Percentage.

Core Formulas

Quantity	Formula
Profit	SP − CP (when SP > CP)
Loss	CP − SP (when CP > SP)
Profit %	(Profit / CP) × 100
Loss %	(Loss / CP) × 100
SP from CP and Profit %	SP = CP × (100 + Profit%) / 100
Discount	MP − SP
Discount %	(Discount / MP) × 100

Successive Discounts

Two successive discounts of a% and b% are equivalent to a single discount of:

Net discount % = a + b − (a×b)/100

Q. A shopkeeper marks an item 40% above cost price and offers a 15% discount. Find his profit percentage.

Let CP = 100. MP = 140. SP after 15% discount = 140 × 0.85 = 119. Profit = 119 − 100 = 19, so Profit % = 19%.

Q. Find the single discount equivalent to two successive discounts of 20% and 10%.

Net discount = 20 + 10 − (20×10)/100 = 30 − 2 = 28%.

⚠️ Key Insight: Discount is always calculated on Marked Price, while Profit/Loss % is always calculated on Cost Price — mixing up the base is the most common error in this chapter.

✅ Practice Focus: CP-SP-MP triangle · Successive discount formula · False weight profit problems · Multiple article profit/loss (CP of a articles = SP of b articles type).

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