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Percentage Profit Formula Questions (from the buying price and selling price)

Updated on March 14, 2013

How To Work Out Percentage Profit Video


Before you can work out a percentage profit first you need to understand a few terms:

Buying Price (cost price) – this is the amount you purchased your item for (usually from the warehouse)

Selling Price – this is the amount that you sold your item for to one of your customers.

So let’s call the buying price B and the selling price S, then the formula for working out the percentage profit will be:

(S – B)÷B × 100

If you don’t like this formula then find the difference between the selling and buying price (the profit), divide this and by the buying price and multiply this answer by 100.

Example

Luke owns a jewellery store. He buys bracelets from a warehouse at a unit price of $2.49. He sells them to his customers for $3.99. Work out the percentage profit made on the sale of each bracelet.

First identify the selling price and buying price.

The buying price is $2.49 and the selling price is $3.99

So: B = 2.49 and S = 3.99

All you need to do next is plug these values into the percentage profit formula:

(S – B)÷B × 100

(3.99 – 2.49) ÷ 2.49 × 100

= 1.50 ÷ 2.49 × 100

= 60.2% profit (rounded off to 1 decimal place)

Example 2

At a local market I buy a violin for $35. I then list this item on Ebay and sell it for $80. What is my percentage profit made on the sale of the violin.

As example 1, first identify the selling price and buying price.

The buying price is $35 and the selling price is $80

So: B = 35 and S = 80

All you need to do next is plug these values into the percentage profit formula:

(S – B)÷B × 100

(80 – 35) ÷ 35 × 100

= 45 ÷ 35 × 100

= 129% profit (rounded to the nearest percent)

This percentage profit formula can also be applied to other problems not involving money.

Example 3

Last calendar month my blog received 428 visitors and this current month my blog received 532 visitors. Work out the percentage increase in visitors to my site.

The amount of visitors to my blog last month is a bit like the buying price (B= 428)

The amount of visitors to my blog for the current month is a bit like the selling price (S = 532)

(S – B)÷B × 100

(532 – 428) ÷ 428 × 100

= 104 ÷ 428 × 100

= 24%

So the increase in visitors to my blog is 24% since last month.

Comments

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  • profile image

    Hussain 

    5 years ago

    This is really helpful

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    Joan Whetzel 

    6 years ago

    Wow. This was super easy to understand.

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