Question:
A shopkeeper calculate percentage profit on the buying price and another on the selling price. What will be their difference in profits if both claim a profit of 20% on goods sold for Rs. 3000?

Option A):
Rs. 400
Option B):
Rs. 200
Option C):
Rs. 100
Option D):
Rs. 150

Correct Answer is Option B):
Rs. 200

Explanation:
For 20% profit on selling price means 1/5 of 3000 i.e. Rs. 600
Now, let the CP = Rs. 100, Then,
SP with 20% profit = Rs. 120
For 20% profit on selling price means cost is 100+ profit is 20 = selling price is 120.
Means selling price is 120% of cost price.
Now selling price is 120% ie 3000 then find 100% amount which will be cost.
Cost = 3000/120%
= 3000/(6/5)
Because, 120% = 6/5
= 3000 x 5/6
= 2500
Cost is 2500
Thus profit is 20% i.e. 1/5 x 2500 = 500
Thus,
Difference is 600-500 = Rs.100.