Profit can be stipulated as a fixed amount or by a known proportion of cost. In either case the basis and agreed gain must be clear.
Example 1: cost Rs 5,000; fixed profit Rs 500; total Rs 5,500.
Example 2: cost Rs 5,000; 10% profit; total Rs 5,500.
The results coincide here. But when the disclosed first price proves false, the effect on a proportional margin becomes particularly relevant to Abu Yusuf’s view.
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Murabahah and Tawliyah: Cost, Profit and Misstatement
Profit can be stipulated as a fixed amount or by a known proportion of cost. In either case the basis and agreed gain must be clear.
Example 1: cost Rs 5,000; fixed profit Rs 500; total Rs 5,500.
Example 2: cost Rs 5,000; 10% profit; total Rs 5,500.
The results coincide here. But when the disclosed first price proves false, the effect on a proportional margin becomes particularly relevant to Abu Yusuf’s view.