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When a fixed amount is withdrawn at the end of every month, the first drawing is outstanding for 11 months and the last for 0 months, so interest on the total drawings is charged for an average period of 5½ months.
Total drawings = Rs. 2,500 × 12 = Rs. 30,000
Interest = Rs. 30,000 × 12/100 × 5.5/12
= Rs. 1,650
Rs. 1,950 would be the figure for withdrawals at the beginning of each month (6½ months).
NCERT (2026-27 edition):
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