According to me-
In the given problem, shopkeeper legally charges 1200 grams of rice by virtue of the fact that he is earning 20% profit.
But in reality he is charging for 1200 grams against actual dispensation of 950 grams. Thereby making a profit of 250 grams. Since shopkeeper is incurring cost on only 950 grams, his profit % should be 250/950 * 100 = 26.32%