P sells a toy to Q at a profit of 40% and Q sells it to R at a profit of 10%. If R pays Rs 539 for the toy, then what was the cost price of toy for P?
Answer & explanation
Correct answer: option 4
Let the Cost price of the toy be 100 units,
If P sells it at profit of 40%, then selling price to Q is 140 units,
This becomes the cost price for Q when he sells it to R at profit of 10%,
Selling price for this transaction is $\frac{110}{100}$ x 140 = 154 units
But R pays Rs 539 for the toy,
Using unitary method
If 154 units = Rs 539
⇒ 1 unit = Rs $\frac{539}{154}$
and 100 units = $\frac{539}{154}$ x 100 = Rs 350
Thus, the cost price of the toy is Rs 350