Y9. Number. Profit and Loss

One of the most important numbers that all businesses want to know about is their profit (or if things are not going so well, their loss).

Profit (on an individual sale) is simply the amount that something is sold for (the selling price) minus the amount it cost (the cost price).

So if a bicycle cost $315 to make and sells for $500, what will be the profit on it. If it goes out of fashion and has to be sold for only $300, what will be the profit on it?

Exercise

Let’s complete exercises 16A and 16B from pages 266 and 267 of the textbook:

The answers are below:

Percentage profit

If a business is selling lots of different things, they might be interested in the percentage profit of each of the goods they sell. This can help them decide which goods to spend more effort marketing.

We can calculate percentage profit using the following formula:

So, if we bought an item for $20 and sold it for $35, what would be our percentage profit?

Examples

Exercise

Let’s complete exercise 16C from page 267 of the textbook:

The answers are below:

Selling Price

We can also do calculations the other way round. That is, if we know how much something cost and we know the percentage profit, we can then work out what price it was sold at.

Example