Question

Company marks a article 25% above the cost price and sold it at Rs 6480 by giving two successive discounts of 20% and 10% each. Find cost price of product and loss/ profit %.
1. Rs 8500, loss of 20%
2. Rs 7200, Loss of 10%
3. Rs 6400, Loss of 10%
4. Rs 7200, Profit of 10%
5. Rs 6400, Profit of 10%

Answer 1

Correct Answer - Option 2 : Rs 7200, Loss of 10%

Given:

Mark up = 25%

S.P. = Rs 6480

Successive discounts = 20% and 10% each.

 

Formula used:

Marked price – (discount × marked price/ 100) = Selling price

Cost price = Marked price/ (1 + (r/ 100))

Where, r = marked up %

Loss % = ((C.P. – S.P.) / C.P.) × 100

Effective discount% = a + b – ((a × b)/ 100)

Where a, b are successive discounts in %

 

Calculation:

Effective discount % = 20 + 10 – (20 × 10/ 100)

⇒ Effective discount = 30 – 2

⇒ Effective discount = 28%

⇒ Marked price of article = 6480/ (1 – 0.28)

⇒ M.P. = 6480/ 0.72

⇒ M.P. = 9000

C.P. of article = M.P. / (1 + 0.25)

⇒ C.P. of article = 9000/ 1.25

⇒ C.P. of article = Rs 7200

Loss % = ((7200 – 6480) / 7200) × 100

⇒ Loss% = 720 × 100/ 7200

⇒ Loss% = 10%

∴ Cost price of article is Rs 7200 and loss % is 10%