Himanshu withdrew Rs 2,500 at the end of each month. The partnership deed provides for charging of interest on drawings @ 12% p.a. Calculate interest on Himanshu's drawings for the year ended March 31, 2017.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs 1,650
When the same amount is drawn at the end of every month, the first drawing is out for 11 months and the last for 0 months, so on average each drawing is out for (11 + 0)/2 = 5.5 months.
Total drawings = Rs. 2,500 × 12 = Rs. 30,000
Average period = 5.5 months
Interest on drawings = 30,000 × 12/100 × 5.5/12 = Rs. 1,650
Drawings at the beginning of each month would give an average of 6.5 months and Rs. 1,950, the figure in Option (1).
NCERT (2026-27 edition):
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