Marked price, discount, free gift and profit: An article is marked at ₹60 and sold at a 15% discount. The shopkeeper also gives a free gift worth ₹3. If he still makes a 20% profit on the article, what is the cost price of the article (excluding the gift cost)?

Introduction / Context:
This problem integrates a percentage discount with an additional fixed cost (a free gift) and asks for the original cost price (CP) of the article. The key is to treat the gift as the shopkeeper’s extra cost while profit percent is computed on the article’s CP.

Given Data / Assumptions:

• Marked price = ₹60, discount = 15% ⇒ SP from the article = 60 * 0.85 = ₹51.
• Gift cost to shopkeeper = ₹3 (extra cost incurred).
• Net profit on the article = 20% of CP.

Concept / Approach:
Profit = Selling proceeds − total cost. Total cost here is CP of article + ₹3 (gift). Set this profit equal to 0.20*CP and solve for CP.

Step-by-Step Solution:

Verification / Alternative check:
If CP = 40, profit = 20% of 40 = 8. Net: SP − (CP + gift) = 51 − (40 + 3) = 8, consistent.

Why Other Options Are Wrong:
Other values do not simultaneously satisfy both the discount-derived SP and the required 20% profit after including the gift cost.

Common Pitfalls:
Ignoring the gift cost in total cost or mistakenly computing profit percent on (CP + gift) rather than on CP of the article.

Final Answer:
₹ 40