On a certain day, a bakery produced a batch of rolls at a total produc

Method I: assign a value to the total number of rolls

Because all the rolls are sold, and because they are all sold at equal prices on their respective days, we can use any number of rolls we want to calculate
Profit as (Total Revenue - Total Cost).

The profit is the same for 300 rolls that cost $300 as it is for 30 rolls that cost $300.

Let # of rolls = 30
Cost per roll = $10

Day 1: \(\frac{4}{5}\) of 30, or 24 rolls, are sold at 50 percent above cost -->
Day 1, PRICE: 50% above cost is (1.5 * $10) = $15 each

Day 1, Total Revenue: (24 * $15) = $360

Day 2: remaining 6 rolls are sold at 80 percent of Day 1's price (of $15) -->
Day 2's price is (.8 * $15)= $12 each

Day 2, Total Revenue: (6 * $12) = $72

Total Revenue for both days: ($360 + $72) = $432

(TR - TC) = PROFIT
PROFIT = ($432 - $300) = $132

Answer C

Method II - Algebra

\(xy = 300\) = Total cost, where \(x\) is unit cost of rolls and \(y\) is # of rolls

Day 1 = \(\frac{4}{5}y * \frac{3}{2}x = \frac{6}{5}xy\)

Day 2 = \(\frac{1}{5}y * (\frac{4}{5}*\frac{3}{2})x\)

\(= (\frac{1}{5}y*\frac{12}{10}x)=\frac{12}{50}xy=\frac{6}{25}xy\)

Day 1 + Day 2: \((\frac{6}{5}xy + \frac{6}{25}xy)= \frac{36}{25}xy\)

\(xy = 300\), so
Total revenue = \((\frac{36}{25})($300) = $432\)

Total cost = \($300\)
Profit = (TR - TC)
Profit = \($132\)

Answer C
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My approach:

Let x is the number of rolls made. Average cost is 300/x.

4/5 of the rolls in the batch were sold, each at a price that was 50 percent greater than the average (arithmetic mean) production cost per roll,
so first day revenue = \(\frac{4x}{5}\) x \(\frac{300}{x}\) x 150%

The remaining rolls in the batch were sold the next day, each at a price that was 20 percent less than the price of the day before,
so second day revenue = \(\frac{x}{5}\) x \(\frac{300}{x}\) x 150% x 80%

Total Revenue = \(\frac{4x}{5}\) x \(\frac{300}{x}\) x 150% + \(\frac{x}{5}\) x \(\frac{300}{x}\) x 150% x 80%
= 432 (x will be canceled out)

Cost = 300, so Profit = 432-300 = 132

We can let the production cost per roll = x and the total number of rolls = t.

On the same day the rolls were made, we are given that (4/5)t rolls were sold at 1.5x each. So the revenue was (1.5x)(4/5)t = 1.2xt

On the following day, we are given that (1/5)t of the rolls were sold for 0.8(1.5x) = 1.2x each. So the revenue was 1.2x(1/5)t = 0.24xt.

Since the production cost was 300:

300 = xt

So,

Profit = (1.2xt + 0.24xt) - xt

profit = (1.44xt) - xt

profit = 1.44(300) - 300 = 132 dollars.

Answer: C
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Let no. of rolls = n
production cost of each roll =p

Given total production cost = n*p =300

Now 1st day : 4/5 no. of rolls were sold at 50% more than production price:
so selling price = (1+50/100)p = 1.5p

so revenue on 1st day = (4/5 *n) *(1.5p) = 1.2 np

now second day: remaining rolls ie 1/5th of rolls sold at 20% less than previous day price :
so selling price = (1-20/100)(1.5p) = 0.8 *1.5p

so revenue on 2nd day = (1/5 *n) *(0.8 * 1.5p) = 0.24 np

Total revenue = 1.2np +0.24np = 1.44np
as np=300
Total revenue = 1.44* 300 = 432

Profit = Revenue - production cost = 432-300 = 132

Answer : C

Can anyone tell me what is wrong with my calculation? carcass

Assume batch of rolls =5
Cost per roll = $300/5= $60

First day sales : 4/5*5*$60*1.5 = $360
Second day sales : 1/5*5*$60*0.8 = $48
Total sales = $408
Profit = $408-$300 = $108

Hi,

The question stem said that "The remaining rolls in the batch were sold the next day, each at a price that was 20 percent less than the price of the day before"
So your calculation for second day sale should be 1/5*5*$60*1.5*0.8 = 72.

Since they never give you total amount of rolls produced, just make it 100 rolls, because 100 is an easy number to work with.

Total cost = $300
Total rolls produced = 100
$3.00 per roll
50% of $3.00 is $4.50
4/5 of 100 is 80
80 x 4.50 = $360.00
20% of 4.50 = $.90
4.50 - .90 = $3.60
3.60 x 20 = $72.00
$360.00 + $72.00 = $432.00
$432.00(revenue) - $300.00(cost) = $132.00 (Profit)

Ans is (C)

I cant's understand why we can't just simply find the cost of goods sold at the first day = 240 (4/5=300)
Then add a margin of 1.5, 240*1.5= 360 (sales) and get profit of the 1st day 360-240 = 120
Then why can't we simply apply 0.8 discount (20% off) to the gross margin for the 1st day of 1.5*0.8 and get 1.2
Applying to 1.2 to 60 (cost of goods sold of the 2nd day, which is found as 300*1/5) = 72 (sales)
72-60 = 12 and 120 + 12 = 132
Why do we need to imagine a number of units sold or write equations?

suppose there are \(100\) roles in a batch
Average price per role is\(=300/100=3\)
as \(4/5\) of \(100\) roles \(= 80 roles\)
\(80\) roles sold at price \(1.5*3=4.5\)
total revenue out of \(80\) roles\(=80*4.5=360\)

Now, remaining \(20\) roles sold at price \(20%\) less than previous day price \((4.5)\)
So price per role for day 2 is \(= 0.8*4.5=3.6\)
Revenue out of \(20\) roles on day 2 \(= 20*3.6=72\)

So total revenue of \(100\) roles \(= 360+72=432\)
\(Profit=Revenue-Cost=432-300=132\)

Answer C

Hi Jeff,

What should be the time required for the calculation in this question? Just Checking where i am?

Profit on first day= 50%
SP on 2nd day=450*0.8=360
Profit on second day= 20%

50........20
.......x......
4............1

4*(50-x)=x-20
x=44

Net profit= 44*300/100=132

Let there be 100 rolls sold at a price of INR 300.
Thus, avg cost of rolls is INR3 on a certain day. That day, 4/5 ie. 80% of the rolls were sold at 50% higher price. Thus, there are 80 rolls sold at INR (3 (1.5)) = INR 4.5. Thus, money made that day is INR 360.
Next day remaining batch of 20 rolls were sold at a price that was 20 percent less than the price of the day before.
(Here is the trick in the Question. There are 2 selling price in the previous day -> 3 and 4.5. We of course need to take 4.5. I admit that i fell for the question trap, took 3 as the selling price and marked the answer as 108-> [360+(20*2.4)]-[300]
20% less on INR 4.5 comes to INR 3.6. This we multiply with 20 to get money made the next day as 72. Thus, total money made on 2 days is 360 + 72 = 432. Thus, profit made is INR 132 (432-300)

Let, total number of rolls = 5
so, avg. cost = $300/5 = $60
First day sales =5*4/5= 4 Rolls@ (60x1.5) = $360
2nd day sales= 1 roll@ (90x.8)= $72
Total Sales = $360+$72= $432. So, Gross profit = $432-$300=$132 [Ans. C]
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Let the total number of rolls in the batch is \(10\)

So, Per unit selling price of the rolls is \(\frac{300}{10}=30\)

Sold on the first day = \(10*\frac{4}{5}=8\); Selling price for the first day \(= 30*1.50= 45;\) The total selling price for 8 rolls\(=45*8=360\)

Rest rolls 10-2=2, Price for the second day 45*80/100=36; The total Selling price for the 2 rolls \(= 36*2= 72\)

Total sales revenue \(360+72 = 432\)

The total cost of the batch was 300. Thus the profit; \(432-300=$132\)

The answer is \(C\)
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Any method that can solve this in 2 mins? took me 3.36 to get to the answer. :/

Let's say 5x rolls were produced, at $1 per roll.
So, CP = 5x
SP of 4x rolls = 6x
SP of x rolls = 1.2x
Total SP = 7.2x

% profit = (2.2x/5x)*100 = 44%

So, profit = 44% of 300 = $132

Jot down the question as it is and the answer will appear.

Total cost = 300$, let total rolls = N

Therefore, 4/5 * N * 1.5 * 300/N = 360

Remaining rolls = 1/5 * N

1/5 * N * 0.8 * 1.5 * 300/N = 72

360+72 = 432

432 - 300 = 132.
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Profit and Loss can be done using Ratios very easily. But one needs to be cautious when Ratios cannot be applied efficiently to solve these kind of problems.
We know there is a average cost price of production: Suppose it is some variable or figure: let us assume it to be x.
Now you know the 80% of the rolls were sold on one day with 50% profit and 20% were sold on another day with 20% discount to the price day before.

Now the catch is this: can i convert this 20% discount on the price to original cost price. Why?
Because we already have rolls SP (the first day batch) in terms of Cost price . Because we know profit as 50%.

50% can be written as a factor of (3/2)* x . So 20% discount on the first day price means , price is 80% of the price the day before.
Now , 80% can be written as 4/5 factor.

So essentially the Selling price on the second day is : (4/5)*(3/2)x = (6/5)*x. That means 20% profit.

So we have 50% profit on first day for 80% rolls and 20% profit on second day for 20% rolls.

So mean profit will be = 44%

So profit = 44% of $300= $132
Hence the answer is C
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Hi Bunuel,

I always stumble whenever I see problems involving sales, profit, revenue, unit cost, percentages, etc. Do you happen to have a post that has these types of problems all in one place?