Profit

and
Loss
Presented by: Gift Anne G. Clarion
Learning Objectives
At the end of the lesson, you should be able
to:

01. Differentiate profit from loss

Illustrate how profit is obtained and how

02.
to avoid loss in a given transaction
 PROFIT LOSS
• It is the amount left • It is what occurred
from the revenue when the cost and
(or sales) after all expenses exceed
costs (or expenses) the revenue or
had been deducted. sales
• It is defined as a
gain in business
 R(x) > C(x) >
C(x)
• If the
exceeds
revenue
the cost,
• If
R(x)
the cost of
production exceeds
so the business the revenue, the
earns a profit business is at loss
 FORMU
LA = Revenue - Cost
PROFIT/LOSS
If, the result is positive, it is a PROFIT
If, the result is negative, it is a LOSS
How to avoid
loss?
• Add new and innovative products and
services in your company
• Make use of modern technology that saves
time, money and energy
• Apply low price strategies
• Optimize your websites in an attractive
way
• Treat your business a business, not as a
hobby or a side job
 PERCENT OF PROFIT OR
LOSS
% PROFIT/LOSS
=
Note: The percent is always taken with
the respect to the cost.
 Assume that you are in the business of buying
and selling shoes. You bought 10 pairs of running shoes
for ₱3,500 each from a wholesaler at the start of
December. Then, you plan to sell these pairs of running
shoes online to your friends before Christmas. You were
able to sell 7 pairs at ₱5,000 each.
However, after Christmas, you have 3 pairs left
unsold. You thought of selling the remaining pairs at
₱2,500 each to ensure that you have sold all items
before New Year.
Now, determine whether you earn a profit or incurred a
loss. Provide how much your profit or loss was.
GIVE Number of running shoes = 10 pairs
Cost per pair = ₱3,500
N Selling price per pair = ₱5,000
Sale price = ₱2,500
Sold pairs = 7 pairs at ₱5,000 (before Christmas)
= 3 pairs at ₱2,500 (after Christmas)
BEFORE
CHRISTMAS,
Revenue = No. of pcs. sold x Selling Price
Revenue = 7 x ₱5,000
Revenue = ₱35,000
Cost = No. of pcs. sold x Cost Price
Cost = 7 x ₱3,500
Cost = ₱24,500
GIVE Number of running shoes = 10 pairs
Cost per pair = ₱3,500
N Selling price per pair = ₱5,000
Sale price = ₱2,500
Sold pairs = 7 pairs at ₱5,000 (before Christmas)
= 3 pairs at ₱2,500 (after Christmas)
BEFORE
CHRISTMAS,
Profit/Loss = Revenue - Cost
Profit/Loss = ₱35,000 - ₱24,500
Profit/Loss = ₱35,000 - ₱24,500
Profit = ₱10,500
After selling 7 pairs of rubber shoes before
Christmas, there is a profit of ₱10,500.
GIVE Number of running shoes = 10 pairs
Cost per pair = ₱3,500
N Selling price per pair = ₱5,000
Sale price = ₱2,500
Sold pairs = 7 pairs at ₱5,000 (before Christmas)
= 3 pairs at ₱2,500 (after Christmas)
AFTER
CHRISTMAS,
Revenue = No. of pcs. sold x Selling Price
Revenue = 3 x ₱2,500
Revenue = ₱7,500
Cost = No. of pcs. sold x Cost Price
Cost = 3 x ₱3,500
Cost = ₱10,500
GIVE Number of running shoes = 10 pairs
Cost per pair = ₱3,500
N Selling price per pair = ₱5,000
Sale price = ₱2,500
Sold pairs = 7 pairs at ₱5,000 (before Christmas)
= 3 pairs at ₱2,500 (after Christmas)
AFTER
CHRISTMAS,
Profit/Loss = Revenue - Cost
Profit/Loss = ₱7,500 - ₱10,500
Loss = - ₱3,000

After selling 3 pairs of rubber shoes at a lower

price than the cost, there is a loss of ₱3,000.
GIVE Number of running shoes = 10 pairs
Cost per pair = ₱3,500
N Selling price per pair = ₱5,000
Sale price = ₱2,500
Sold pairs = 7 pairs at ₱5,000 (before Christmas)
= 3 pairs at ₱2,500 (after Christmas)
HOW MUCH IS THE TOTAL
Profit (Before PROFIT?
Christmas)= ₱10,500
Loss (After Christmas) = (₱3,000)

Total Profit/Loss = ₱10,500 - ₱3,000

Profit = ₱7,500
The total profit in selling 10 pairs of rubber
 GIVE Number of running shoes = 10 pairs
Cost per pair = ₱3,500
N Selling price per pair = ₱5,000
Sale price = ₱2,500
Sold pairs = 7 pairs at ₱5,000 (before Christmas)
= 3 pairs at ₱2,500 (after Christmas)
HOW MUCH IS THE PROFIT RATE?
Profit % =

Profit % = ( )
₱7,500
₱35,000
𝑥100%

Profit % = 0.2143 x 100%

Profit % = 21.43%
 FORMULA FOR SELLING
PRICE
If there is a profit, the formula is
Selling Price = Cost Price x (1 + Profit %)

If there is a loss, the formula is

Selling Price = Cost Price x (1 - Loss %)
 FORMULA:
A dealer bought a SP = Cost Price x (1 + Profit
car for ₱ 720,000. GIVEN:
%)
Cost = ₱720,000
How much must he
Profit % = 20%
resell the car to be
assured of a 20% SOLUTION
profit? : C X (1 + Profit %)
SP=
SP = ₱720,000 x (1 + 20%)
SP = ₱720,000 x (120%)
SP = ₱864,000
 FORMULA:
SP = Cost Price x (1 – Loss
Find the GIVEN:
%)
selling price if Cost = ₱1,200
the cost price Loss % = 25%
is ₱1,200 and
loss percent is SOLUTION
25. : C X (1 - Loss %)
SP=
SP = ₱1,200 x (1 - 25%)
SP = ₱1,200 x (75%)
SP = ₱900
 FORMULA:
Profit/Loss=Revenue-Cost
A second-hand car
GIVEN:
was sold for Revenue = ₱190,000
₱190,000 at a loss Loss = ₱85,000
of ₱ 85,000. Find
SOLUTION
the cost price of :
Profit/Loss = Revenue - Cost
the car. -₱85,000 = ₱190,000 - Cost
Cost = ₱190,000 + ₱85,000
Cost = ₱275,000
 BOARD WORK!
1. Michael bought a condominium unit for
₱4,150,000 and sold it for ₱5,800,500. How
much was his profit/loss %?
2. Allen bought a cellphone for ₱30,000 and
sold it for ₱23,400. What is the profit/loss
3.
%?A 40 inches flat screen TV was bought for
₱18,950 and sold at a loss of ₱4,780. Find
the revenue.
 QUIZ
In the midst of the community quarantine during
COVID-19 pandemic Gipyang Merchandising paid
₱15,000 for 20 gallons of alcohol which they
ordered on online shops. Delivery expense are 18%
of the selling price while the required profit is 15%
of the selling price. When the community
quarantine was lifted-up they were forced to sell the
alcohol at 30% loss.
A. What was the regular selling price?
B. What was the sale price?
C. What was the profit or loss?
 QUIZ
In the midst of the community quarantine during
COVID-19 pandemic Gipyang Merchandising paid
₱15,000 for 20 gallons of alcohol which they
ordered on online shops. Delivery expense are 18%
of the selling price while the required profit is 15%
of the selling price. When the community
quarantine was lifted-up they were forced to sell the
alcohol at 30% loss.
A. What was the regular selling price?
B. What was the sale price?
C. What was the profit or loss?