"The toy is on the floor."
Translation:Aia ka mea pāʻani i ka papahele.
"Aia ma ka mea pāʻani i ka papahele." has two prepositional phrases (two "on the" phrases) and no subject. Your sentence literally says "(There- Aia) on the toy on the floor."
"is on the" meaning Aia ma ka, then would start with the place first - "Aia ma ka papahele ka mea pāʻani." However, it is more common to split that up and put the item right after Aia AND THEN the place where the item is - Aia ka mea pāʻani ma ka papahele. Perhaps the hint should have been written like this "is .... on the". I hope that is clear.