Concept:
A spring balance measures the tension acting through it. When two spring balances are connected in series, the tension throughout the string/balance assembly remains constant if the balances themselves are massless.
Step 1: {Analyze the tension in the lower spring balance.}
The lower balance is directly supporting the 20 kg mass. The tension $T$ in the lower balance is:
$$T = mg = 20 \times g$$
The reading is shown as the mass equivalent, which is 20 kg.
Step 2: {Analyze the tension in the upper spring balance.}
Since the balances have negligible mass, the upper balance supports the lower balance plus the mass.
$$\text{Total mass below upper balance} = m_{\text{lower balance}} + m_{\text{block}}$$
$$\text{Total mass} = 0 \text{ kg} + 20 \text{ kg} = 20 \text{ kg}$$
Step 3: {Apply the principle of tension in series.}
In a series connection of massless components, the force (tension) is transmitted undiminished. Thus, the tension $T$ is the same for both balances.
$$\text{Reading}_1 = \text{Reading}_2 = 20 \text{ kg}$$