Tom bought a pen for $60 and sold it to gain 20% on his cost price. How much money did he gain?

• A. $12
• B. $10
• C. $14
• D. $15

Answer: (A)

To determine the gain Tom made from selling the pen, we first need to calculate 20% of his cost price. Tom bought the pen for $60, so we compute 20% of $60 as follows:

20% can be expressed as a fraction: 20/100 or 0.20. Therefore, to find 20% of $60, we multiply:

[ 0.20 \times 60 = 12 ]

This calculation shows that Tom's gain from selling the pen is $12. To find the selling price, we can also add this gain to the cost price:

Cost price ($60) + Gain ($12) = Selling price ($72)

The total amount Tom gains is $12, which directly confirms that a gain of $12 aligns with the 20% profit calculated from his initial investment of $60. Thus, the correct amount Tom gained from the sale of the pen is indeed $12.