DISCOUNTS, SALES TAX, PROFIT OR LOSS

Original value or Cost price or Buying price = 100%

If Profit or Tax added on = 15% ;

Value ( including tax) or selling price ( including profit) ( 100 + 15) % = 115%

If there is a Loss or Discount of 15%;

Value (reduced value) or selling price = ( 100 - 15%) = 85%

A sales tax is a tax added on the selling prices of some articles.

Other names for sales are GCT or VAT

● GCT means General Consumption Tax

● VAT means Value Added Tax

For calculations involving discounts, sales tax and profit or loss it is good practice to
use the Unitary Method, i.e., we find what 1% is worth.

Examples
1. During a sale, all prices were reduced by 20 %. Find the sales price of a shirt which
has a marked price of $ 800.
Solution

Given information:
● The marked price of the shirt is $800.
● The discount during the sale is 20%.

20
100
× 800 = $160

To find the sales price = marked price − discount

= $ 800 − $ 160
= $ 640
∴ during the sale, the sales price of the shirt with a marked price of $800 after a
20% discount is $640.
DISCOUNTS, SALES TAX, PROFIT OR LOSS

2. After a discount of 20%, a pair of shoes was sold for $ 1500. Find its original price?
Solution

Given information:
● After a discount of 20%, the pair of shoes was sold for $1500.

Let the original price of the pair of shoes be x

Discounted price = Original price - Discount amount

$ 1500 = 100x − 20x (Since the discount is 20%, which is 20% of the original price)
$ 1500 = 80x divide both sides by 80
$ 18.75= x

Orginal price = 100%

= $ 100 × 18. 75
= $ 1875
∴the original price of the pair of shoes before the 20% discount was $1875

3. At a store, a television set has a marked price of $ 25, 000. However there is a
GCT of 17.5% paid on all purchases.
How much will a customer pay in total for the TV set?
Solution

Given information:
● The marked price of the TV set is $25,000.
● The GST (Goods and Services Tax) rate is 17.5%.

17.5
100
× 25,000 = $4,375

Total cost = Marked price + GST amount

= $ 25, 000− $ 4, 375
= $ 29, 375

∴ the customer will pay a total of $29,375 for the TV set, including the marked price of
$25,000 and the GST of $4,375 (17.5% of the marked price)
DISCOUNTS, SALES TAX, PROFIT OR LOSS

4. A customer pays $35, 250 for a stove; this price includes a GCT of 17.5% .
Find the price of the stove before tax was added.
Solution
Given information:
● The total price paid by the customer for the stove, including GST, is $35,250.
● The GST rate is 17.5%.

Let's denote the price of the stove before tax as x.

Total price = Price before tax + GST

$35,250 = 100x + 17.5x (Since the GST is 17.5%, which is 17.5% of the price before tax)
$35,250 = 117.5x divide both sides by 117.5
300 = x

Price before tax (orginal price) = 100%

= $ 100 × 300
= $ 30, 000

∴ the price of the stove before the GST of 17.5% was added is $30,000.

5. A shopkeeper sells his goods in order to make a 15% profit. If he buys a book for
$ 1,600, how much will he sell it for?
Solution
Given information:
● The cost price (the price at which the shopkeeper buys the book) is $1,600.
● The shopkeeper wants to make a profit of 15% on the cost price.

Let's denote the price of the stove before tax as x.

Profit amount = Cost price × Profit percentage

15
= $ 1600 × 100
= $ 240

Selling price = Cost price + Profit amount Selling price

= $1,600 + $240
= $1,840
∴ if the shopkeeper buys the book for $1,600 and wants to make a 15% profit, he will sell
the book for $1,840.
DISCOUNTS, SALES TAX, PROFIT OR LOSS

6. A shopkeeper sells his goods to make a 15% profit. A pen was sold for $ 345, how
much did he pay for the pen?
Solution

Given information:
● The selling price of the pen is $345.
● The shopkeeper makes a 15% profit on the cost price.

Let's denote the cost price of the pen as x.

Selling price = Cost price + Profit

$345 = 100x +15x (Since the increase is 15%, which is 15% of the cost price)
$345 = 115x divide both sides by 115
3=x

Buying price = 100%

= $ 100 × 3
= $ 300
∴ the shopkeeper paid $300 for the pen, which he sold for $345 to make a 15% profit.

7. A company gives all workers a 10% salary increase. What would be the new salary
of a clerk who was earning $ 25, 000?
Solution

Given information:
● The clerk's original salary was $25,000.
● The company gives a 10% salary increase to all workers.

Amount of salary increase = Original salary × Increase percentage

10
= $25,000 × 100
= $2,500

New salary = Original salary + Amount of salary increase

= $25,000 + $2,500
= $27,500

∴ the new salary of the clerk after the 10% salary increase would be $27,500.
DISCOUNTS, SALES TAX, PROFIT OR LOSS

8. A company gives all workers a 10% salary increase. After the increase, a salesman
received a salary of $ 34, 650 per week? How much did he earn before the increase?
Solution

Given information:
● The salesman's new salary after the 10% increase is $34,650 per week.
● The salary increase was 10%.

Let's denote the original salary before the increase as x.

New salary = Original salary + Increase amount

$34,650 = 100x +10x (Since the increase is 10%, which is 10% of the original salary)
$34,650 = 110x divide both sides by 110
315 = x

Salary before increase = 100%

= $ 100 × 315
= $ 31, 500
∴ before the 10% salary increase, the salesman's original salary was $31,500 per week.

9. A saleswoman was asked to increase the price of a dress by 20%. However, she
decreased it by 20% instead, thereby selling the dress for $ 1,500. How much should
she have sold the dress for?
Solution

Given information:
● The saleswoman was supposed to increase the price of the dress by 20%.
● Instead, she decreased the price by 20%, selling the dress for $1,500.

Let the original price be x.

Decreased price = Original price − 20% of the original price

$1,500 = 100x − 20x
$1,500 = 80x divide both sides by 80
$18.75 = x

∴ the original price of the dress was $1,875.

Correct selling price = Original price + 20% of the original price

= $1,875 + (0.2 × $1,875)
DISCOUNTS, SALES TAX, PROFIT OR LOSS

= $1,875 + $375
= $2,250

∴ the saleswoman should have sold the dress for $2,250 after a 20% increase in the
original price of $1,875.

10.Ann Felix bought a car for $ 20,000 and sold it for $ 15,000. What was her
percentage loss?
Solution

Given information:

● Ann Felix bought the car for $20,000.

● Ann Felix sold the car for $15,000.

Loss = Cost price - Selling price

= $ 20,000 − $ 15,000
= $ 5000

Percentage loss = (Loss / Cost price) × 100%

$ 5000
Ann’s percentage loss = $ 20,000
× 100%
= 25%
∴ Ann Felix's percentage loss when she sold the car for $15,000 after buying it for
$20,000 was 25%.

Note:
If we know the cost price (C.P.) or buying price, and the selling price (S.P.) we can find
the profit made or the loss incurred.

Profit = Selling Price − Cost Price Loss = Cost Price − Selling Price
𝑃𝑟𝑜𝑓𝑖𝑡 𝐿𝑜𝑠𝑠
Percentage Profit = 𝐶𝑜𝑠𝑡 𝑃𝑟𝑖𝑐𝑒 × 100% Percentage Loss = 𝐶𝑜𝑠𝑡 𝑃𝑟𝑖𝑐𝑒 × 100%

If the cost price of an item and the percentage profit/loss is known, you can find the
selling price.
DISCOUNTS, SALES TAX, PROFIT OR LOSS

TRY THESE
1. The marked price of a machine is $ 12, 000. How much will it cost if there is a
discount of 25% for cash?
2. A tax of 16% is added to the marked price of articles. If a purchaser pays $ 2,330.00
inclusive of tax, what is the amount of tax paid?
3. When the price of a dress is reduced by 12%, it is sold for $ 3,520. What was the
original price?
4. A shirt marked $920.00 was sold at a discount of 10%. What was the selling price?
5. How much does a customer psy for an article marked at $ 150.00 if a tax of 18% is
charged?
6. A woman buys a pair of shoes at a sale. She pays $ 1,400.00, saving $600.00 on the
normal price. What is the percentage discount on the shoes?
7. Mrs. Smith bought a table at a discount of 30% thus saving $ 1,500. What was the
original price of the table?
8. Jason makes a table for $ 80. He sold it for $ 100
a. What was his profit?
b. What was his percentage profit?
9. Jason bought his bicycle for $ 450. He sold it for $ 300.
a. What was his loss?
b. What was his percentage loss?

10. A suit cost $ 300 to make. What is?

a. The profit
b. The selling price
If it is sold for a 12% profit?

11. Andrew Prescott bought his car for $ 63, 500 and sold it at a 20% loss.
a. What was his loss?
b. What did he sell the car for?

12. A cassette recorder is priced at $ 720. It is sold in a sale at a 7% discount.

a. What is the discount?
b. What is the sale price?
1
13 . Janette buys an electric drill for $ 120. She sells it for a 33 3 % profit. What is the
selling price?