Saloni and Srishti are partners in a firm. Their capital accounts as on April 01. 2019 showed a balance of Rs. 2,00,000 and Rs. 3,00,000 respectively. On July 01, 2019, Saloni introduced additional capital of Rs. 50,000 and Srishti, Rs. 60,000. On October 01, 2019 Saloni withdrew Rs. 30,000 and on January 01, 2020 Srishti withdrew Rs. 15,000 from their respective capitals. Interest is allowed @ 8% p.a. Calculate interest payable on capital to Saloni during the financial year 2019-2020.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 17,800
When capital changes during the year, interest on capital is worked out on each balance for the period it stayed in the firm. Saloni’s capital had three balances during 2019-20:
April 1 to June 30 (3 months): Rs. 2,00,000 × 8% × 3/12 = Rs. 4,000
July 1 to September 30 (3 months): Rs. 2,50,000 × 8% × 3/12 = Rs. 5,000
October 1 to March 31 (6 months): Rs. 2,20,000 × 8% × 6/12 = Rs. 8,800
Interest on Saloni’s capital = Rs. 4,000 + Rs. 5,000 + Rs. 8,800 = Rs. 17,800
The same answer comes another way: Rs. 16,000 on the opening capital for 12 months, plus Rs. 3,000 on the Rs. 50,000 added for 9 months, less Rs. 1,200 on the Rs. 30,000 withdrawn for 6 months. Srishti’s figures belong to the other partner and do not enter Saloni’s interest.
NCERT (2026-27 edition):
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