The difference between cost price (CP) and selling price (SP) of an article is Rs 240. If the profit is 20%, then the selling price is
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → 1440
The difference between the selling price and the cost price is the profit, and profit per cent is always worked out on the cost price. So Rs 240 is 20% of the cost price.
20% of CP \(=240\), so \(\displaystyle \mathrm{CP}=\frac{240\times100}{20}=1200\)
SP \(=\) CP \(+\) profit \(=1200+240=1440\)
The value 1200 in Option (3) is the cost price; the question asks for the selling price.