Profit and Loss Problems – Civil Service Exam

Profit and Loss Problems - Civil Service Exam

Overview of Solving Profit and Loss Problems

Profit and loss problems are a fundamental aspect of financial arithmetic, involving calculations to determine the financial outcome of transactions. Here’s a simplified explanation of the concepts and steps involved in solving these problems:

Key Concepts:

Cost Price (CP): This is the price at which an item is purchased or the cost to the seller.
Selling Price (SP): This is the price at which an item is sold to the buyer.
Profit: If the selling price is greater than the cost price, the difference between them is the profit. $Profit = SP - CP$
Loss: If the cost price is greater than the selling price, the difference is the loss. $Loss = CP - SP$
Profit Percentage: This is the percentage of the profit relative to the cost price.
Loss Percentage: This is the percentage of the loss relative to the cost price.

Steps to Solve:

Identify the Cost Price and Selling Price: Read the problem carefully to find the CP and SP.
Determine if it’s a Profit or Loss: Compare CP and SP to determine if the transaction resulted in a profit or a loss.
Calculate the Profit or Loss: Use the formulas provided to calculate the absolute value of the profit or loss.
Calculate the Percentage: If required, compute the profit or loss percentage using the respective formulas.
Consider Additional Factors: Sometimes, problems may involve discounts, markups, or taxes. Adjust the CP or SP accordingly before performing the above calculations.

Example:

A trader buys goods for PHP 500 and sells them for PHP 600.

Cost Price (CP) = PHP 500
Selling Price (SP) = PHP 600
Profit = SP – CP = PHP 600 – PHP 500 = PHP 100
Profit Percentage =

Practice Test on Profit and Loss Problems - Civil Service Exam

Problem 1. Question: If a shopkeeper buys notebooks for PHP 50 each and sells them for PHP 65 each, what is the profit percentage on each notebook?

Choices:
A. 20%
B. 25%
C. 30%
D. 35%

Answer: C
Solution:
Profit per notebook = Selling Price – Cost Price = PHP 65 – PHP 50 = PHP 15.
Profit percentage =

Problem 2. Question: A furniture dealer purchases a desk for PHP 1,200 and sells it for PHP 1,440. What is the profit percentage?

Choices:
A. 15%
B. 18%
C. 20%
D. 25%

Answer: C
Solution:
Profit = Selling Price – Cost Price = PHP 1,440 – PHP 1,200 = PHP 240.
Profit percentage =

Profit and Loss Exercises

1. A merchant buys a dining table for ₱28,000 and sells it for ₱25,000. What is his loss?

2. A trader buys a smartphone for ₱18,000 and sells it for ₱22,000. What is his profit?

3. A trader wants to make a profit of 12% on a desktop computer he bought for ₱25,000. At what price should he sell it?

4. A vendor buys a microwave oven for ₱15,000 and sells it for ₱12,000. What is his loss percentage?

5. A shopkeeper buys a wardrobe for ₱20,000 and sells it for ₱24,000. What is his profit percentage?

6. A merchant sells an item at a loss of 10%. If the selling price was PHP 450, what was the original cost price?

7. A trader buys a refrigerator for ₱45,000 and sells it for ₱40,500. What is his loss percentage?

8. A merchant buys a washing machine for ₱30,000 and sells it for ₱27,000. What is his loss?

9. A trader wants to make a profit of 12% on a desktop computer he bought for ₱25,000. At what price should he sell it?

10. A merchant buys a laptop for ₱35,000 and sells it for ₱42,000. What is his profit?

Answers

1. 3,000

2. 4,000

3. PHP 28,000

4. 20%

5. 20%

6. PHP 500

7. 10%

8. PHP 3,000

9. PHP 28,000

10. PHP 7,000