A shopkeeper buys a bag for ₹850 and sells it for ₹1,020. Find his profit percentage.
- AOption (a)
20%
- BOption (b)
40%
- COption (c)
30%
- DOption (d)
25%
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Correct answer
20%
Why this answer is correct
Shortcut Trick
Ratio of Cost Price (CP) to Selling Price (SP) = 850 : 1,020.
Dividing by 170: CP : SP = 5 : 6.
Profit = 6 − 5 = 1 unit.
Profit% = (1 ÷ 5) × 100 = 20%.
∴ The correct answer is 20%.
Alternate Method
Given → CP = ₹850, SP = ₹1,020.
Formulas: Profit = SP − CP | Profit% = (Profit ÷ CP) × 100.
⇒ Profit = 1,020 − 850 = ₹170.
⇒ Profit% = (170 ÷ 850) × 100.
⇒ Profit% = (1 ÷ 5) × 100 = 20%.
∴ The correct answer is 20%.
Additional Information
Profit and Loss Basics
Profit occurs when SP > CP. Loss occurs when CP > SP. Formula: Loss% = (Loss ÷ CP) × 100.
Selling Price Calculation
SP = CP × (100 + P%) ÷ 100 or SP = CP × (100 − L%) ÷ 100.