Profit, loss and discount

Cost price, marked price, successive discounts, and the false-profit trap.

14 min read · Lesson 6 of 6 · Pro

Four prices, and the base each one uses

CP — cost price, what the seller paid
SP — selling price, what the buyer paid
MP — marked price, the printed or listed price
Discount — a reduction on MP

Now the rule that decides everything:

Profit and loss percentages are always on CP. Discount percentage is always on MP.

Two different bases. Confusing them is the number one mistake in this topic.

Formulas:

Profit = SP - CP, Loss = CP - SP
Profit% = (Profit / CP) * 100
SP = CP * (100 + Profit%) / 100
CP = SP * 100 / (100 + Profit%)
SP = MP * (100 - Discount%) / 100

Successive discounts

The rest of this lesson is Pro

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