Cost, marked and selling price

The idea

The marked price is the price the shopkeeper quotes, the selling price is what the customer pays after any discount, and the cost price is what the shopkeeper paid to buy the item.

One sweater, three prices

Kishanlal buys sweaters from a wholesaler at ₹300 each. He quotes ₹480 to his customers. After some bargaining, a customer buys one for ₹430.

Which of these is the price Kishanlal paid to get the sweater?

• ₹300
• ₹430
• ₹480

Name the three prices

Tap a price, then pick its label. First look from Kishanlal's side. Then switch to the wholesaler's side and look at the ₹300 again.

Who pays, and who quotes

The marked price is the price the shopkeeper quotes, the selling price is what the customer pays after any discount, and the cost price is what the shopkeeper paid to buy the item.

For Kishanlal: Cost price: ₹300 (he paid the wholesaler) Marked price: ₹480 (he quotes it to customers) Selling price: ₹430 (the customer pays it after bargaining)

The selling price ₹430 is more than the cost price ₹300, so Kishanlal makes a profit of 430 − 300 = ₹130. If the selling price is less than the cost price, there is a loss.

The labels depend on the context. The wholesaler sells at ₹300, so for the wholesaler ₹300 is a selling price. For Kishanlal, who paid it, the same ₹300 is a cost price.

Notes

The marked price is the price the shopkeeper quotes, the selling price is what the customer pays after any discount, and the cost price is what the shopkeeper paid to buy the item.

Check yourself

A shop buys a toy for ₹150, marks it ₹250 and sells it for ₹220. Which is the cost price?

Meena buys a bag from a shop for ₹500. The shop had marked it ₹650. Which is the selling price of the bag?

A wholesaler sells a bag to a shop for ₹400. For the shop, ₹400 is the...

A shopkeeper pays ₹90 for a notebook, quotes ₹120 and sells it for ₹100. Which statement is correct?

• ₹150 — correct. Yes! The cost price is what the shop paid to buy the toy.
• ₹250. ₹250 is the price the shop quotes: the marked price. The cost price is what the shop paid, ₹150.
• ₹220. ₹220 is what the customer pays: the selling price. The cost price is what the shop paid, ₹150.
• ₹500, the price Meena pays — correct. Yes! The selling price is what the customer pays after any discount.
• ₹650, the price on the bag. ₹650 is the price the shop quoted: the marked price. Meena paid ₹500, which is the selling price.
• We cannot tell without the cost price. The selling price is what the customer paid, so the cost price is not needed. Meena paid ₹500.
• Cost price — correct. Yes! The shop paid ₹400 to get the bag. The same ₹400 is the selling price for the wholesaler.
• Selling price. ₹400 is the wholesaler's selling price. The shop is the one who paid it, so for the shop it is the cost price.
• Marked price. The marked price is what a shopkeeper quotes to customers. The shop paid ₹400, so for the shop it is the cost price.
• The marked price is ₹120 — correct. Yes! ₹120 is the price he quotes. The cost price is ₹90 and the selling price is ₹100.
• The cost price is ₹100. ₹100 is what the customer pays: the selling price. The cost price is what he paid, ₹90.
• The selling price is ₹120. ₹120 is the quoted price, the marked price. The customer pays ₹100, which is the selling price.
• The cost price is ₹120. ₹120 is the quoted price, the marked price. He paid ₹90 to buy it: that is the cost price.