Mehul, Harsh and Asgar are partners in a firm sharing profit & loss equally. Harsh withdrew the following amount from the firm, for his personal use during 2020-21.
| Date | Harsh(₹) |
| April 1, 2020 | ₹ 5,000 |
| July 1, 2020 | ₹ 8,000 |
| December 1, 2020 | ₹ 5,000 |
| March 1, 2021 | ₹ 4,000 |
Calculate the interest on drawings, when rate of interest is 10% p.a.
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → ₹ 1,300
Product method; the paper’s year 2020-21 runs from April 1 to March 31, so months are counted up to March 31, 2021 (the book’s illustration closes its books on December 31 instead):
April 1, 2020: ₹5,000 × 12 months = ₹60,000
July 1, 2020: ₹8,000 × 9 months = ₹72,000
December 1, 2020: ₹5,000 × 4 months = ₹20,000
March 1, 2021: ₹4,000 × 1 month = ₹4,000
Total of products = ₹1,56,000
Interest on drawings = ₹1,56,000 × 10/100 × 1/12 = ₹1,300
NCERT (2026-27 edition):
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