John buys a cycle worth 31 dollars and pays with a cheque of 35 dollars. The…

Concept: When a deal involves several linked cash movements — a sale, a cash exchange, and a repayment triggered later by a bounced cheque — the seller's overall profit or loss is the net effect of every inflow and outflow taken together, not any single transaction viewed by itself. Profit/Loss = (total amount effectively received) − (total amount effectively paid out or lost).

Working:

1. Cost price (CP) of the cycle to the shopkeeper = 19 dollars.

2. John pays with a cheque of 35 dollars for a cycle priced at 31 dollars; the shopkeeper exchanges this cheque with his neighbour for 35 dollars in cash and hands John change of 35 − 31 = 4 dollars from it.

3. Selling the cycle at 31 dollars against its cost of 19 dollars gives the shopkeeper a profit of 31 − 19 = 12 dollars on the sale (this already nets out the 4 dollars change, since only 31 of the 35 cash exchanged is the cycle's actual price).

4. Two days later the cheque bounces, so the shopkeeper must return the full 35 dollars to the neighbour, recovering nothing from that cheque.

5. Net result = profit on the sale − repayment to the neighbour = 12 − 35 = −23, i.e., an overall loss of 23 dollars for the shopkeeper.

Cross-check:: Track every cash movement independently of the sale/profit framing — the shopkeeper receives 35 dollars from the neighbour, pays out 4 dollars as change to John, bears the 19-dollar cost of the cycle, and later pays back 35 dollars to the neighbour. Net cash = 35 − 4 − 19 − 35 = −23, the same 23-dollar loss confirmed by a second method.