1. What is Loss Percentage?

Loss percentage is a financial metric that measures the percentage of loss incurred when selling an item compared to its original cost price. It helps businesses and individuals understand their financial performance.

2. How Does the Calculator Work?

The calculator uses the loss percentage formula:

Where:

• Cost Price — Original purchase price of the item
• Selling Price — Price at which the item was sold

Explanation: The formula calculates what percentage of the original cost was lost in the transaction.

3. Importance of Loss Percentage

Details: Calculating loss percentage is crucial for financial analysis, pricing strategies, and determining business profitability. It helps identify areas where costs need to be controlled.

4. Using the Calculator

Tips: Enter the cost price and selling price in the same currency units. The cost price must be greater than zero for a valid calculation.

5. Frequently Asked Questions (FAQ)

Q1: What does a negative loss percentage mean?
A: A negative loss percentage indicates a profit was made (selling price was higher than cost price).

Q2: How is this different from profit percentage?
A: Profit percentage is calculated when selling price > cost price, while loss percentage is for selling price < cost price.

Q3: What's considered a high loss percentage?
A: This varies by industry, but generally a loss percentage above 10-15% may be concerning for most businesses.

Q4: Can I use this for stock market investments?
A: Yes, this formula is commonly used to calculate loss percentage on investments.

Q5: Should I include additional costs in the cost price?
A: For accurate calculations, include all associated costs (shipping, taxes, etc.) in the total cost price.