1. What is Profit and Loss Percentage?

The profit and loss percentage measures the financial gain or loss relative to the cost price. It's expressed as a percentage of the original cost, providing a standardized way to compare performance across different investments or products.

2. How Does the Calculator Work?

The calculator uses these fundamental formulas:

Where:

• \( Profit \) — Selling price minus cost price
• \( Loss \) — Cost price minus selling price
• \( Cost \) — Original purchase or production cost

Explanation: The formulas calculate what percentage of the original cost was gained (profit) or lost (loss) in the transaction.

3. Importance of Profit/Loss Calculation

Details: Calculating profit and loss percentages helps businesses evaluate performance, set pricing strategies, and make informed financial decisions. It's essential for budgeting, forecasting, and investment analysis.

4. Using the Calculator

Tips: Enter the original cost price and either the selling price or final amount. Positive results indicate profit, negative results indicate loss. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between profit/loss in dollars vs percentage?
A: Dollar amounts show absolute gain/loss, while percentages show relative performance compared to the investment.

Q2: Can the calculator handle multiple items?
A: This calculates for single transactions. For multiple items, sum all costs and results first.

Q3: How is this different from markup percentage?
A: Markup is based on cost, while profit percentage is based on selling price. They measure different aspects of pricing.

Q4: What if my result is exactly 0%?
A: This means you broke even - no profit or loss on the transaction.

Q5: Can I use this for investment returns?
A: Yes, this works for any scenario where you want to compare final value to initial cost.