A small and medium enterprise imports two components A and B from Taiwan and China respectively and assembles them with other components to form a toy. Components A contributes to 10% of production cost while components B contributes to 20% of production cost. Usually the company sells this toy at 20% above the production cost. Due to increase in the raw material and labour cost in both the countries ,component A became 20% costlier and components B became 40% costlier. Owing to these reasons the company increased its selling price by 15%. Considering that cost of other components does not change. What will be the profit percentage if the toy is sold at the new price?

Explanation:-

Let the original cost of the toy be Rs. 100.
Then,
Original cost of component A
= 10% of Rs. 100
= Rs. 10.
Original cost of component B
= 20% of Rs. 100
= Rs. 20.
Original S.P. of the toy
= 120% of Rs. 100
= Rs. 120.
New cost of component A
= 120% of Rs. 10
= Rs. 12.
New cost of component B
= 140% of Rs. 20
= Rs. 28.
New price of the toy
= Rs. [100 + (12 + 28) - (10 + 20)]
= Rs. 110.
New S.P. of the toy
= 115% of Rs. 120
= Rs. 138
Profit = Rs. ( 138 - 110) = Rs. 28. $$\eqalign{ & \therefore {\text{Profit }}\% = \left( {\frac{{28}}{{110}} \times 100} \right)\% \cr & \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = 25.45\% \cr & \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = 25.5\% . \cr}$$