# Selling Price Formula - What is the Selling Price Formula? Examples, Derivation, Formula (2024)

The selling price formula is used to calculate the selling price, which is the price at which a product is sold. If we compare the selling price and the cost price of any article, we can find the profit or loss incurred in the transaction. There are different formulas with the help of which the selling price can be calculated. Let us understand the different selling price formulas in the lesson.

## What is the Selling Price Formula?

The basic formula that is used to calculate the selling price of a product is: Selling price (S.P.) = Cost Price (C.P.) + Profit. Selling price can be calculated by using different formulas. In order to understand the other formulas, we need to know the terms related to them.

Cost Price (C.P.): Cost price is the price at which a product is purchased.

Profit (Gain): Profit is the amount that is gained or earned in the transaction. In other words, if the selling price is greater than the cost price, then the difference between them is called profit.

Loss: Loss is the amount that is lost in the transaction. This means if the selling price is less than the cost price, then the difference between them is called loss.

Formula 1: Selling Price Formula = {(100 + Gain%)/100} × CP

If we observe the first formula, we see that when the Cost price and gain percentage is given, we can easily calculate the selling price.

Example: If the cost price of an article is \$40 and there is a gain of 20% in the transaction, find its selling price.

Substituting the given values in the formula: Selling Price = {(100 + Gain%)/100} × CP = {(100 + 20)/100} × 40 = (120/100) × 40 = 48. Therefore, the Selling price of the article is \$48.

Formula 2: Selling Price Formula = {(100 – Loss%)/100} × CP

If we observe the second formula, we see that when the Cost price and loss percentage is given we can calculate the selling price.

Example: If the cost price of an article is \$30 and there is a loss of 10% when it is sold, find the selling price.

Substituting the given values in the formula: Selling Price = {(100 – Loss%)/100} × CP = {(100 – 10)/100} × 30 = 27. Therefore, the Selling price of the article is \$27.

Formula 3: Selling Price Formula = CP + Profit

If we observe the third formula, we see that when the Cost price and profit (\$) is given we can calculate the selling price.

Example: If the cost price of an article is \$25 and it is sold at a profit of \$5, find the selling price.

Substituting the given values in the formula: Selling Price = CP + Profit = 25 + 5 = 30. Therefore, the Selling price of the article is \$30.

Formula 4: Selling Price Formula = CP – Loss

In the fourth formula, we see that when the cost price and loss (\$) is given we can find the selling price.

Example: If the cost price of an article is \$35 and it is sold at a loss of \$3, find the selling price.

Substituting the given values in the formula: Selling Price = CP - loss = 35 - 3 = 32. Therefore, the Selling price of the article is \$32.

## Difference Between Selling Price and Marked Price

In order to be at par with the competition in business and to increase the sale of goods, shopkeepers offer some rebates to customers. It should be noted that there are two more terms related to this concept - the marked price (list price), and discount. Marked price is a price on which the seller offers a discount. After the discount is applied to the Marked price, it is sold at a reduced price known as the selling price.

Marked price: Marked price is the price set by the seller on the label of the article.

Discount: The rebate given by the shopkeepers to attract the customers is called a discount. Discount is always calculated on the Marked price of the article.

Therefore, we have another formula to calculate the selling price:

Selling Price = Marked Price - Discount.

Example: If the marked price of an article is \$300, and there is a 20% discount on it, find the price at which it is sold.

In this case, there is a 20% discount on the marked price.

20% discount on marked price = (20/100) × 300

Discount (\$)= 6000/100 = \$60

Now, using the selling price formula, Selling Price = Marked Price - Discount (\$) = \$300 − \$60 = \$240. Therefore, the selling price of the article is \$240.

Let us have a look at a few more solved examples to understand the selling price formula better.

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## Selling Price Formula Examples

Example1: Ryan buys a calculator for \$720 and sells it at a loss of 6(2/3)%. Find the selling price of the calculator.

Solution: Given, CP= \$720; Loss= 6(2/3)% =20/3%
Using the selling price formula,
SP = {(100 – Loss %)/100} × CP
Substituting the values,
SP = {(100-(20/3))/100} × 720
SP = {280/300} × 720
SP = \$672

Answer: The selling price of the calculator is \$672.

Example 2: James bought a bicycle for \$600 and sold it at a profit of \$100. Find the selling price of the bicycle.

Solution: Given, CP = \$600, Profit = \$100
Using the selling price formula,
SP = CP + Profit
Substituting the values,
SP = 600 + 100
SP = 700

Answer: The selling price of the bicycle is \$700.

Example 3: If the marked price of an article is \$400, and there is a 15% discount on it, find the selling price.
Solution:

In this case, there is a 15% discount on the marked price. 15% discount on marked price = (15/100) × 400 = 60

Discount (\$)= 6000/100 = \$60

Therefore, using the selling price formula, Selling Price = Marked Price - Discount (\$) = \$400 − \$60 = \$340

Answer: The selling price of the article is \$340.

## FAQs on Selling Price Formula

### What is the Selling Price Formula When Gain Percentage is Given?

Gain is the profit earned in a transaction and sometimes it is given in terms of percentage. Cost price is the price at which a product is purchased. When the gain percentage and the cost price is given, we calculate the selling price using the formula, Selling price (SP) = {(100 + Gain%)/100} × Cost Price

### What is the Selling Price Formula When Loss Percentage is Given?

When the loss percentage and the cost price is given, we calculate the selling price using the formula, Selling price(S.P.) = {(100 – Loss%)/100} × Cost Price. It should be noted that cost price is the price at which a product is purchased. Loss is incurred in a transaction when the selling price is less than the cost price. It is also expressed in the form of a percentage.

### What is the Selling Price Formula When Cost Price and Profit is Given?

When the cost price and profit is given, we calculate the selling price using the formula, Selling price = Cost Price + Profit. We know that Cost price is the price at which a product is purchased and profit is the amount that is gained or earned in the transaction.

### What is the Selling Price Formula When Cost Price and Loss is Given?

In a transaction, a loss occurs when a product is sold at a lesser price than its cost. Cost price is the price at which a product is purchased. When the cost price and loss is given, we calculate the selling price using the formula, Selling Price = Cost Price – Loss.

### What is the Selling Price Formula When Marked Price and Discount is Given?

When the marked price and discount on an article is given, we calculate the selling price using the formula, Selling Price = Marked Price - Discount. it should be noted that Marked price is the price set by the seller on the label of the article and discount is the rebate given by the shopkeepers to attract the customers. For example, the marked price (list price) of an article is \$50, and there is a \$5 discount on it, we can find its selling price using the formula, Selling Price = Marked Price - Discount. Substituting the values in the formula, Selling Price = Marked Price - Discount = 50 - 5 = 45. Therefore, the selling price of the article is \$45.

## FAQs

### What is the formula to calculate selling price? ›

Determine the total cost of all units purchased. Divide the total cost by the number of units purchased to get the cost price. Use the selling price formula to calculate the final price: Selling Price = Cost Price + Profit Margin.

What is the selling price? ›

The selling price of something is the price for which it is sold. The difference between buying and selling prices is called the spread.

How do you calculate average selling price example? ›

Calculating average sales price is rather simple compared to other inventory management formulas. To figure out your ASP, divide the total revenue earned by the total number of units sold. This looks like: average selling price = [total revenue earned ÷ number of units sold].

How do you find the selling price without a calculator? ›

Rules for finding the sale price given the original price and percent discount
1. At first, we consider the original price and discount rate.
2. The rate is usually given as a percent.
3. To find the discount, multiply the rate by the original price.
4. To find the sale price, subtract the discount from original price.

What is sale price example? ›

Thus, a 30% discount on a \$100 list price will result in a sale price of \$70. Another interpretation of the term is that it is simply the price at which something sells. For example, if a work of art is bid up to a record price of \$10 million, then that is its sale price.

What is an example of a selling cost? ›

Selling expenses can include: Distribution costs such as logistics, shipping and insurance costs. Marketing costs such as advertising, website maintenance and spending on social media. Selling costs such as wages, commissions and out-of-pocket expenses.

How do you calculate selling price and margin? ›

Calculate a retail or selling price by dividing the cost by 1 minus the profit margin percentage. If a new product costs \$70 and you want to keep the 40 percent profit margin, divide the \$70 by 1 minus 40 percent – 0.40 in decimal. The \$70 divided by 0.60 produces a price of \$116.67.

How do you calculate average buy and sell price? ›

To calculate the average cost, divide the total purchase amount (\$2,750) by the number of shares purchased (56.61) to figure the average cost per share = \$48.58. Cost Basis = Average cost per share (\$48.58) x # of shares sold (5) = \$242.90.

What is the formula of average with example? ›

Average This is the arithmetic mean, and is calculated by adding a group of numbers and then dividing by the count of those numbers. For example, the average of 2, 3, 3, 5, 7, and 10 is 30 divided by 6, which is 5.

How do you calculate average product with example? ›

The Basic Calculation

Divide the total product by the input of labor to find the average product. For example, a factory that produces 100 widgets with 10 workers has an average product of 10. Average product is useful for defining production capabilities at a specific level of input.

### What is the example of price? ›

Noun You paid a high price for the car. We bought the house at a good price. The price of milk rose. What is the difference in price between the two cars?

What is selling give an example? ›

Selling is any transaction in which money is exchanged for a good or service. During a sales negotiation, the seller attempts to convince or “sell” the buyer on the benefits of their offer.

What does selling price mean in math? ›

Selling price = (cost) + (desired profit margin) In the formula, the revenue is the selling price, the cost represents the cost of goods sold (the expenses you incur to produce or purchase goods to sell) and the desired profit margin is what you hope to earn.

What are selling and distribution costs examples? ›

Sales and Distribution Expenses Sales and distribution expenses mainly consist of salaries and benefits for staff, transportation and insurance costs, maintenance and repair expenses, travelling expenses, office utility expenses, business entertainment and marketing expenses and depreciation costs.

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