Let us begin with Profit & Loss
Sumit sir Try this question:
A farmer buys a cow for 1,00,000 rupees and sells it for
1,20,000 the next year. What is the profit percentage made
by the farmer on the sale of the cow?
Solution: If the farmer sells the cow for 1,20,000 we know the
profit made = 20,000 (Selling Price - Cost Price)
now to find the profit percentage we need to find what
percentage 20,000 or 1,00,000.
Which is simply 20%; (20,000/1,00,000)*100
Profit Percentage = 20%
Introduction to Profit & Loss
Sumit sir When a person buys an article for a certain price and then
sells it for a different price, he makes a profit or incurs a
loss.
Profit = Selling Price - Cost Price
For example, if you bought an umbrella for 800, this is the
cost price of the umbrella. It is abbreviated as C.P.
if Neil sold the same umbrella for 1000, then 1000 is
considered the selling price of the umbrella. It is
abbreviated as S.P. and makes a profit of 200.
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Significance of Profit & Loss
Sumit sir Let us have a look at the number of questions from
Arithmetic as a whole that appeared in the previous year
CAT exams.
Modern
Exam Arithmetic Algebra Numbers Geometry
Maths
CAT
7-8 4-8 1-3 2-4 2-4
2023
The
ques number
t o
rang ions are i f CAT
9-10 5-6 1-2 3-4 3-4
e bec na 2022
differ ause of
weig ent
h
differ tage in
ent s
lots CAT
9-10 4-5 0-2 3 4
2021
CAT
10 5-8 3-5 3-8 0-2
2020
Here is the weightage of Time, Speed and Distance in the
recent year CAT exams.
Averages, Ratios,
TSD & Time and Profit, Loss &
Exam Percentages and
Work Interest
Mixtures
CAT 2023 2-4 1-3 2-3
CAT 2022 5 1-3 5
CAT 2021 3 1-2 4-5
CAT 2020 4-5 2 3-4
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Significance of Arithmetic
Sumit sir Let us now have a look at the weightage of Arithmetic as a
whole in the various MBA-related exams.
Exam Weightage of Arithmetic
7-8 out 22 questions in the
CAT 2023
QA Section
2 out of 28 questions in the
XAT 2024
QA-DI Section
Approx. 11 out of 36 questions
NMAT 2023
in the QS Section
Approx. 5 out of 20 questions
SNAP 2023
in the QA, DI & DS section
5 out of 20 questions in the
MICAT 2023-24
QA DI section
7 out of 20 questions in the QT
CMAT 2024
& DI section
27 out of 50 questions in the
CET 2024
QA DI section
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Significance of Profit &
Loss
Sumit sir
As you can see Arithmetic is a very important topic from
the perspective of any of the major MBA-related exams.
This in turn makes Profit & Loss which is one of the major
subtopics under Arithmetic very important for us to master!
Let’s now jump into understanding more about Profit and
Loss. Let’s start with the important formulas associated with
the topic!
Important Formulas to
Remember
Sumit sir
Listing down the most important formulas and pieces of
information for you:
1) Equal % profit & loss on the same selling price of 2
articles:
If two items are sold at Rs X each, one at a loss of p % and
the other at a gain of p %, then the two transactions have
resulted in an overall loss of (P²/100) %. This is the loss in
percentage.
2) Equal % profit & loss on the same cost price of 2 articles:
If the cost price of two items is X, and one is sold at a loss of
p % and the other at a profit of p %, then the two
transactions have resulted in no loss or no gain.
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Important Formulas to
Remember
Sumit sir
Profit (or) Gain = SP – CP
Profit % = (Profit/CP) × 100
SP = (100 + gain % )/100 × CP
CP = 100/(100 + gain %) × SP
Loss = CP – SP
Loss % = Loss/(CP) × 100
SP = (100 – loss %)/100 × CP
CP = 100/(100 – loss %) × SP
Let’s solve an actual CAT
question
Sumit sir
Let’s now solve an actual CAT 2019 question, don’t be overly
concerned based on the outcome just give your best!
Question: A man's petrol bill in July is Rs.200. In August, the
price of petrol increases by 10% and his consumption is
reduced by 10%. Find his petrol bill in August. (CAT 2019)
Answer: 198
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Let’s solve an actual CAT
question
Sumit sir
Let the consumption in July = x litres,
Price per litre x Consumption = Total Petrol Bill
Therefore, price of petrol = Rs. 200/x
Consumption in August will be 0.9x and price will be
1.1(200/x)
=> Petrol bill in August = (0.9x) x(1.10)x 200/x= Rs.198.
Let’s solve an actual XAT
question
Sumit sir
Question: The cost price of an article is Rs 280. A shopkeeper
sells it by allowing 16% discount on its marked price and still
gains 20%. What is the marked price of the article?
a 400
b) 360
c) 420
d) 350 (XAT 2021)
Answer: 400
Solution: The cost price of article = Rs 280
Gain = 20%
Selling price of the article = (120/100)×280
= Rs336
Let the marked price of the article = M
Discount = 16%
Selling price of the article =
(84/100) M
=> 336 = (84/100) M
M = 400
Marked price of the article = Rs 400
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Let’s solve an actual SNAP
question
Sumit sir
Question: The cost price of an article is Rs. 390. If it is to be sold
at a profit of 3.12 per cent, how much would be its approximate
selling price? (SNAP 2019)
?
Answer: 402 SP
Solution: Profit obtained in selling the article at 3.12%
= 3.12 * 390 = Rs. 12
100
=> Selling price = 390 + 12 = Rs. 402
Let’s solve an actual CMAT
question
Sumit sir
Question: Rohit bought 20 soaps and 12 toothpaste. He
marked-up the soaps by 15% on the cost price of each, and the
toothpaste by Rs.20 on the cost price each. He sold 75% of the
soaps and 8 toothpastes and made a profit of Rs.385. If the cost
of toothpaste is 60% of the cost of a soap and he got no return
on unsold items, what was his overall profit or loss?
(CMAT 2019)
Answer: Loss= 355
Solution: Let the CP of 1 soap = S
Thus, the CP of 1 toothbrush = 0.6S
Given that, SP of 1 soap = 1.15 S and SP of 1 toothbrush = 0.6S+20
Also, 15*1.15*S + 8*(0.65+20) - 155 - 8*0.6*S = 385
Thus, solving we get S = 100
Hence, Total CP of 20 soaps and 12 toothbrush = 20*100 + 12*60
= 2720
SP of 15 soaps and 8 toothbrush = 15*1.15*100 + 8*80 = 2365
Thus, the overall loss = 2365 - 2720 = 355 Rs.
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Lets solve an NMAT type
question
Sumit sir
A sold an article with 10% loss on the cost price. He bought
the article at a discount of 20% on the labelled price. What
would have been the percentage loss had he bought it at
the labelled price?
(A) 34%
(B) 18%
(C) Data inadequate
(D) 28%
Answer: 28%
Solution: Let Label Price = Rs100
A Purchased at 20% discount, hence
Purchase Price = 80
Cost pace for A = 80.
A sold for 10%Loss.
Selling Price= 80 - 10%(80) = 72
If A had purchaged for is 100 sold for 72.
Loss = 100-72 = 28
%loss = 100-72/100 = 28%
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My Advice for you
Sumit sir Profit and Loss is a very easy-to-understand topic if
your grip over the concepts is solid.
Learning percentage to fraction conversion from 1/2 up
to 1/30 would come in really handy to solve Profit and
Loss questions quickly
Spend time practising solving the different kinds of
questions that arise from Profit and Loss. There are only
a handful of types. (You will learn them during the live
sessions and through the concept builder videos)
Go about studying any topic on the dashboard in a
structure to maximize the gains. Follow this structure:
Attend the Live class of
Profit and Loss
Watch the recorded concept
builders on the dashboard
Solve the topic E-Book on
the dashboard
Give the sectional test to judge
your progress
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