Vinay sells an articel at a profit of 20 percent. If both the cost price and selling price are reduced by Rs. 20, then the profit becomes 40 percent. What is the initial cost price ?

Rs. 40

By cross multiplication method =

              CP               SP

20%P     5                 6

40%P     5                 7

           -20               -20

     ——————————————

    35 - 30         =         -100 + 140

       5x = 40

       x  = 8

Initial cost price = 5x = 5× 8 = 40