A garment shop sells a shirt for ₹ A, incurring a loss of 5%. During an end-of-season sale, they mark up the same shirt to ₹1.2A. At the sale, they provide a flat discount of 10% on this marked price. What will be the percentage profit or loss for the garment shop on that shirt during the sale?
- (a)4.6% Profit
- (b)2.6% Loss
- (c)2.6% Profit
- (d)4.6% Loss
Answer
Why
Correct — C. Find the cost price from the first sale, then compare the sale price with it.
First sale: ₹A is a 5% loss, so A = 0.95 × CP
Cost price: CP = A ÷ 0.95
Sale price: 1.2A less 10% = 1.2A × 0.9 = 1.08A
SP ÷ CP: 1.08A ÷ (A ÷ 0.95) = 1.08 × 0.95 = 1.026
Result: 1.026 − 1 = 0.026, a 2.6% profit → option (c)
Why the others are wrong
- (a)4.6% Profit — 4.6% profit would need a sale price of about 1.101A (1.046 × A ÷ 0.95). The sale price is 1.2A × 0.9 = 1.08A, which is 2.6% above cost.
- (b)2.6% Loss — Right size, wrong direction. The sale price 1.08A is above the cost A ÷ 0.95 ≈ 1.053A, so the shop gains. With A = 95: cost ₹100, sale ₹102.6.
- (d)4.6% Loss — A 4.6% loss means selling at 0.954 of cost, about 1.004A. The sale price is 1.08A, above the cost of about 1.053A, so there is no loss at all.
Concept
Anchor everything to cost price. The first sale says only that A is 95% of cost, so cost = A ÷ 0.95. The marked price 1.2A and the 10% discount are both built on A, not on cost.
A clean check takes A = 95: cost 100, marked price 1.2 × 95 = 114, sale price 114 × 0.9 = 102.6. The gain is 2.6 on 100.
The whole chain is three factors on cost: 0.95 (A is 95% of cost), then × 1.2 (the mark-up on A), then × 0.9 (the discount). 0.95 × 1.2 × 0.9 = 1.026.
Key facts
- A 5% loss means selling price = 0.95 × cost price.
- A 10% discount multiplies the marked price by 0.9.
- Profit % = (SP ÷ CP − 1) × 100, and here 1.026 − 1 = 0.026 = 2.6%.
Study next
Common traps
- Treating A as the cost price, which makes 1.08A look like an 8% profit.
- Adding the percentages, −5 + 20 − 10 = 5, instead of multiplying the factors.
The same set-up with a profit in place of the loss is asked at 12 Sep 2025, 16:00, Quant Q.15: sold at ₹P for a 20% profit, marked at 1.5P, 10% off, so 1.35P on a cost of P ÷ 1.2, a 62% profit.
15 Sep 2025, 12:30, Quant Q.10 marks up 50% on cost and takes successive discounts of 10% and 20%, leaving an 8% profit of ₹80 on a ₹1080 sale.
Related PYQs
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