Logically problem

this is a great confusion for me too kindly tell in a simple form as if profit on sales is 25 percent what should br the cost price and vice versa

Pardon me if I did not understand your query but if you are having problem in ratio structure, look at it this way,

Sell price = Cost + Profit

Cost =100

Profit = 33

So Sales Value will be 133

Now in this 133, Cost part is 100/133 and profit part is 33/133

The percentage value of profit from 33.33% to 25% changes because of change in the main value on which it is based.

Profit remains same in value but changes when percentage values are concerned

so Profit = 33/100 i.e.33%while you calculate it on cost and it is 33/133 i.e. 25% when you calculate it on Sales.

You can also use equation to derive the same thing,

Say Let us say Cost is x

then profit will be .33x,

now sales value = x + .33x

Thus sales value is 1.33 x that is 1.33 times of x

Now out of this 1.33x, .33 x is profit so by dividing

.33x by 1.33x you will get 25%

Using this in an example,

Say Cost is Rs.8 and profit is Rs.2

So sales value is Rs.10 (Since Cost + profit = Sell Price)

Now profit is 2/8 i.e. 25 % of Cost but it is

2/10 i.e. 20% of Sales.

what if profit on sales is given, then how to find profit on sales

Say profit on sales is 10 % & you have to find profit on cost then

sales = cost + profit

100% = x + 10/100 and cost is remaining part of 100 i.e. 90/100.

These are alternative methods to understand one single thing and must be practised one by one to get a grasp on logic.

DEAR ANUBHA, LET ME FIRST THANK YOU FOR YOUR INITIATIVE TO GET ME OUT OF THIS CONFUSION.

COULD YOU KINDLY SEND ME SOME EXAMPLES ABOUT MATERIAL MANAGMENT IN OUR COSTIN SUBJECT  THANKS

Profit on 33.33% on cost means cost should taken as 100 that is

 Cost - 100

Profit – 33.33   (1/3)

Sales -  133.33 (1/4)

That means 33.33% = 1/3  on cost  (33.33/100)    is 25% = 1/4  on sales  (33.33/133.33)

Further example  Cost  - Rs 500       = 100%

                         Profit – Rs 166.65  = 33.33%

                         Sales – Rs 666.665 = 133.33%

166.65 profit    * 133.33% = Sales        166.65 profit     * 100  = cost

 On 33.33%                                           33.33%

Suppose it says 33.33 on sales,  sales should be taken as 100

Sales    -  100%

Profit   - 33.33%

Cost   -  66.66%

Here 33.33% =1/3 on sales (33.33/100) is 66.66% = 2/3 on cost

To prove,

When Gross profit is 33⅓% on cost, it is equal to 25% on sales

We know that, 

Sales = cost + profit 

Let us assume, cost =100 

Therefore, profit = 33⅓% of cost i.e  33.33

Hence, sales = 100 +33.33

              Sales= 133.33

 here , profit =33.33

Hence,  % of profit on sales = 33.33/133.33×100

                                                 =25%

Therefore, % of profit on sales is 25% when,  % of profit on cost is 33⅓%

To prove,

When Gross profit is 33⅓% on cost, it is equal to 25% on sales

We know that, Sales = cost + profit

Let us assume, cost =100

Therefore, profit = 33⅓% of cost i.e 33.33

              Then, sales = 100 +33.33

                         Sales= 133.33

             here , profit =33.33

Hence, % of profit on sales = 33.33/133.33×100 =25%

Therefore, % of profit on sales is 25% when, % of profit on cost is 33⅓%

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The logic is very simple,

Suppose profit is 33.33% i.e 1/3 on cost(1) ,

We equate the Total price as: 1 + 1/3 = 4/3

Now, arithmetically we calculate GP margin: 1/3 upon 4/3 = 1/4 i.e 25%

Hence, 1/3 on cost is equivalent to 1/4 on sales and so on.